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Good old life insurance, so reassuring for savers, could well lose its appeal. In 2025, nearly 18 million French people risk seeing their returns collapse.
If you are one of those who count on this savings for supplement their incomeexpect a nasty surprise. Find out in the following lines what the future holds for your savings.
Life insurance: the choice of serenity
Life insurance is often the option of choice for those looking to combine security and profitability. First, there is the advantageous tax system. After eight years of contractyou benefit from a tax exemption on earnings, up to an annual ceiling. This is a major asset for those who wish to grow their savings while optimizing taxes.
In addition, life insurance offers great flexibility. You have the choice between the security of euro funds and the profitability of the units of account. In short, it allows us to adapt to all needs and all investor profiles. The big plus? It often offers a profitability often more attractive than that of traditional investments.
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Then, life insurance allows you to prepare for transmission of one’s heritage. In the event of death, the capital is passed directly to the designated beneficiaries, often with considerable tax advantages. However, bad news is on the horizon that could overshadow these benefits.
Changes in life insurance
Life insurance interest rates are what make it different from traditional savings accounts. Let’s take the example of euro funds which, in 2024, have an average rate of 2.60%. Some contracts even reach almost 4%. This figure is an impressive jump from 2021, when the average rate was just 1.3%.
The increase is explained in particular by inflation, which has hit hard since 2023. This phenomenon has forced banks to adjust their rates to protect the purchasing power of savers. However, this dynamic could be about to change. If inflation has started to fall, this could play a role to the disadvantage of savers in the long term.
Indeed, for 2025, bank forecasts announce stagnation, or even a drop in yields. This is particularly the case for funds in euros. This situation risks darkening the profitability outlook for those who were counting on a continued increase in their investments.
Those affected?
Subscribers to a euro fund contract will have to expect a drop in yield. This bad news affects nearly 18 million French people, but could affect up to 38 million life insurance holders.
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So, how do you know if you are one of those affected by this unpleasant news? Normally you should receive an email or letter soon. These detail the performance of euro funds for 2025. Faced with this, some investors could turn to more profitable investments.
Nevertheless, there is hope. Insurers, to limit the fall in yields, have a powerful lever: their reserves. By drawing on the latter, they can improve the performance of euro funds. They may offer a bonus of 1 to 2%which remains a relief in an uncertain economic context.
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