Life insurance, a multifunctional product

Life insurance, a multifunctional product
We do not know what tomorrow will bring: this is the feeling shared by a majority of French people today who, as a precaution, put money aside. The current market conditions that persist on low passbook rates allow life insurance to play a major role.

Life insurance: what you need to know
Life insurance is one of the instruments adapted to meet the client's project (s). A true “Swiss Army Knife” of diversified savings, life insurance makes it possible to fulfill many objectives: build up and seek to enhance capital, which remains available (*) at all times, receive additional income, prepare for retirement, grow your capital while benefiting from a specific tax system, prepare an inheritance or pass on an inheritance.
(*) Subject to contractual provisions (examples: times and costs of a partial or total buyback). In the presence of an accepting beneficiary, or a secured creditor, its agreement is mandatory.
 Good to know
Over the first six months of the year, 15.1 billion euros in net inflows were placed on life insurance contracts, i.e. 3.4 billion euros more than in 2018 during the same period, according to the French Insurance Federation (FFA). Proof that this savings instrument is popular. Why ? Because life insurance is a real multi-function product.
Life insurance to prepare for a future project
Life insurance is presented as a contract that will allow you to build up capital that can be diversified to prepare for projects by combining the security of support in euros with the performance potential of unit-linked support (1) on the medium and long term, in return for a risk of capital loss.

The distribution of the capital of life insurance contracts can be adjusted according to the client's objectives and investor profile since the member has the possibility of distributing his payments on the support in euros and on units of account (1 ) permanent or temporary, the latter with an expiry date.
 
Two types of contracts are the most widespread, responding to different strategies:
The first, life insurance in euros, allows you to invest your savings without risk. The capital can be guaranteed and earns capitalized interest.
The second, multi-support life insurance, includes support in euros and support invested in stocks or bonds. In this configuration, savings placed on unit-linked media are not guaranteed. But the potential for returns is higher in the long run.
The member can make payments at their own pace, occasionally or regularly.
Life insurance is a contract by which the insurer undertakes, in return for the payment of premiums, to pay an annuity or a capital to one or more specified persons, then making it possible to adapt to the member's needs ( build up capital, receive additional income, pass on capital at the time of death, etc.).

The life insurance contract allows you to have your capital at any time (subject to the contractual provisions (examples: deadlines and costs of a partial or total surrender), on simple request if necessary (except accepting beneficiary, pledge …)
 To note
In the event of partial or total redemption, the contract products (interest and capital gains) are subject to specific taxation. These products are taxable, depending on the choice of the member:

at a flat tax rate which may vary depending on the date of premium payment and the duration of the contract
or the progressive income tax scale.
These taxable products are also subject to the social security contributions in force.
Life insurance to prepare for retirement
 
Here again, life insurance is proving to be a good tool for making it easy to prepare a retirement capital or to benefit from additional income paid for life.

A life annuity contract is a specific life insurance contract in euros: in return for a single payment, the member receives a periodic annuity for the rest of his life, the amount of which depends on his age and the paid-up capital.

The member / subscriber of a life insurance contract has the option of setting up a so-called programmed buyback plan, the amount and frequency of which he sets. The redemptions are paid as long as the capital constituted allows it.
Life insurance to pass on wealth
The subject of inheritance is also one of the concerns of the French. Taking out a life insurance contract can help anticipate difficulties, because the particularity of this type of contract is that, in principle, it does not include inheritance. Only the member can designate the beneficiary (ies) of his life insurance contract. It is a personal right that no one else can exercise.