High-end life insurance: what are the contracts worth since the Pacte law?
Widely affected by the Pacte law which entered into force in 2019, life insurance is becoming more mobile in 2020, more transparent, and still as attractive for high-end contracts. The units of account are still very remunerative, for payment slips that can vary between 100,000 € and several million euros. What are the advantages for you ? Personalized management, a wide choice of investment vehicles and more security on assets.
Pacte law: what consequences for life insurance contracts?
Among the many measures affecting life insurance, the most emblematic is that allowing it to be transferred to the new Retirement Savings Plan (PER) introduced by the government. By making this transfer, the saver benefits from a new reduction.
It can be supplemented, if it is not used, on the occasion of other withdrawals of the general abatement. Interest generated after the transfer of life insurance is therefore exempt up to 9,200 euros for a single person and 18,400 euros for a couple, instead of 4,600 euros and 9,200 euros respectively at present.
However, the operation must be carried out before December 31 of the year of said redemption on a retirement savings plan. A benefit strictly linked to PER and valid until January 1, 2023 for holders of life insurance contracts of more than eight years for whom there are still 5 years of work remaining before retirement.
The other great novelty is the possibility of switching from one contract to another, within the same company, without penalties or payment fees when taking out the new contract while retaining its tax precedence with the agreement. of the insurer. The Pacte law thus removes the obligation to hold units of account to effect the transfer, thus opening this operation to all contracts.
Life insurance: more transparent contracts
The government's text promotes transparency in the life insurance sector. Insurers must publish annually, on their website, the average guaranteed return and the average rate of profit sharing allocated for each of their life insurance or capitalization contracts. This publication must take place within 90 working days from December 31 of the year in respect of which these revaluations are made. This publication must remain available for a minimum period of five years. Transparency also on fees charged on units of account. In the future, insurers have the obligation, on each contract whose guarantees are expressed in units of account, to specify the gross performance of costs, the net performance and all the commissions charged during a period defined by order of the Minister for the Economy.
What novelties for the high-end sector?
These new measures strengthen the attractiveness of high-end insurance contracts. Ideal for investing large sums (from an estate for example), these contracts are taken out with bankers or insurers. The first payment is generally around € 100,000 minimum, or even, for certain contracts, minimum outstandings of € 10 million. The client then benefits not only from advice and from an optimized legal and fiscal framework with experts at his disposal to define a personalized management and investment strategy. It also benefits from a wider choice of assets (flexible, bond, atypical, convictions, guaranteed in capital, with security of capital gains, etc.) and more varied units of account. The management fees under mandate for top-of-the-range insurance range from 1% per year depending on the client's risk taking and the breakdown between funds in euros and unit of account. On the latter, annual fees are of the order of 0.90% to 0.95%.
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