Life insurance: the match between the different types of funds in euros

Created in 2014 and then simplified by the Pacte law of 2019, the euro-croissance fund has not yet found its audience. But, with the steady decline in yields of the classic fund, the situation could change.

What are the differences between the two mediums? Euro-croissance is a guaranteed product, but only at a certain maturity which can range from eight to thirty or forty years, depending on the insurers. In addition, the capital may only be guaranteed at 80%. On the contrary, the money placed in the classic euro fund is guaranteed at all times. Practical consequences? “As the guarantee of euro-growth is over, if you recover your savings before this term and the markets are hectic, it is possible that its value will drop”, warns Stellane Cohen, president of the online broker Altaprofits.

In return for this lower capital protection, the insurer seeks to generate better financial performance. “With a partial 80% guarantee and a fifteen-year horizon, we can give ourselves the possibility of doing better than the fund in euros, estimates Stellane Cohen. We are aiming with the Generations Sustainable Growth fund from Generali for a return of 3% per year on average, compared to around 1.20% for the fund in euros.” Please note that this performance objective can be accompanied by good years, but also by less good ones. Thus the Afer Eurocroissance fund (which is no longer marketed) had posted a negative performance in 2018 then rebounded to +13% in 2019.

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Some players are indeed warning about the strong dependence of these supports on the good health of the equity markets. “The portfolios of funds in euros are older and they have old bonds which offer higher interest, underlines Roger Caniard, financial director of the MACSF group. a period of negative interest rates. They therefore only have the possibility of generating performance if the equity markets are rising.” Another possibility to improve the performance of euro-growth funds: insurers have the right to puncture each year a small part of the wealth accumulated on the… classic euro fund.

Euro-croissance funds are not unanimous. “The reality is that it did not take because customers appreciate the capital guarantee and the fact of being able to recover their savings at any time”, underlines Stefan de Quelen, managing director of Meilleurtaux Placement. In addition, euro-growth is suffering from competition from units of account, with limited risk, such as real estate funds. In addition, the performance of the fund in traditional euros can be increased when the saver agrees to invest part of his savings in units of account, which are more risky. “For savers who accept this principle, we manage to obtain good rates on funds in euros”, adds Tommy Pierre Pollet, head of the financial offer within the consulting group in wealth management Selexium.

Euro-growth can nevertheless be used by the most cautious savers to begin a moderate diversification of their assets. It can also serve as a complement to euro funds, without however replacing it completely. “For a balanced portfolio, you can opt for a 30% distribution on the fund in euros, on which we will draw if necessary, 20% on the growth fund and 50% on units of account”, specifies Stellane Cohen . There remains a difficulty: there are few insurers offering this option, Generali and Axa being the two main players.

The Express

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Infographics

Dario Ungiusto / L’Express


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