Life insurance: can we block your cash withdrawals?

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With an average return of only 1.28%, savers who have bet on life insurance are looking gloomy. We are a long way from the 2% net of the livret A issued since August 1, 2022. In addition, this investment is guaranteed, liquid and free of charge.

Some, then, are worried about the effects of the Sapin 2 law which could affect their savings. This law makes it possible to block or delay withdrawal operations. But if massive withdrawals were seen over the next few weeks, could insurers really stop their customers from withdrawing money?

The Sapin 2 law was adopted in 2016 with the aim of regulating financial flows. And it has been talked about a lot, especially among savers. Its purpose is to allow insurers to limit, suspend or delay redemption operations or payments on life insurance contracts. But a safeguard has been provided: it can only be activated in exceptional circumstances, such as the economic crisis of 2008.

This makes several observers say that the fear of activating this lever is unfounded for the moment. “Of course, zero risk does not exist. In the event of an exceptional situation, the High Council for Financial Stability will have the possibility of imposing certain measures, ”said Stellane Cohen, president of Altaprofits, to Boursorama. However, he moderates: “But we are not currently in a serious situation for the stability of the financial system which would explain that the HCSF triggers the Sapin 2 law”.

On the insurers’ side, there are currently no massive withdrawals, the collection is even positive, which means that savers deposit more money on their contracts than they withdraw.

The 1.28% return posted by life insurance contracts only concerns capital invested in euro funds with guaranteed capital. Units of account allow for better profitability and 40% of payments made in 2021 are now directed towards this type of support.

The returns for 2022 will only be known during the first weeks of 2023, however, we should not expect great performances, but rather a drop in the rates delivered to savers. According to Stellane Cohen, rates could drop to 0.6% or even 0.5%… unless insurers decide to dip into their reserve of money.

Because each year, establishments set aside part of their profits to distribute them later. This could raise rates to 2% for two years.