Each beginning of the year is accompanied by the traditional period of announcement of the rates of return on euro funds of life insurance companies. Although few figures have yet been revealed, a large majority of them are expected to be down from last year. For the saver, even if this discovery will not be the most pleasant, it is also a real opportunity that is offered to him to question and reflect on his asset allocation.
Incentives for unit-linked investment
The current economic environment is characterized by low interest rates leading to an inevitable drop in the returns of euro funds. Forced to a capital guarantee and the selection of liquid assets, life insurance companies must favor investments offering low returns for their euro fund, with the consequence of yields served to their clients which are crumbling. over the years.
To curb abundant fundraising that is rushing into euro funds, most insurers have opted for the granting of a bonus to investors who allocate a significant portion of their life insurance contract in unit-linked funds. . This performance bonus is a real boon for the saver. It provides a very attractive return, as part of a liquid investment with guaranteed capital.
Moreover, this bonus has an educational virtue for savers who invest for the long term: by encouraging them to allocate part of their savings to unit-linked accounts, the latter could well benefit from a higher long-term performance by counterpart of risk taking. Note that some insurers may offer, in the event of the premature death of the saver, that the beneficiaries of the contract will receive at least the capital invested.
A wide choice of units of account
In order to compensate for this lack of capital guarantee on the part of the portfolio invested in units of account, savers must adapt their allocation to their risk profile and their investment horizon, by sufficiently diversifying their portfolio in order to limit it. global volatility.
Traditionally, savers have access to 2 main categories of financial products: units of account invested in equities, exhibiting high volatility in return for a high return expectation, and units of account invested in bonds, presenting lower risk. but also a less ambitious return potential.
But, beyond investments in stocks or bonds, the choice of investment themes available is immense. They are also often unknown to savers. And, because it is difficult for the investor to navigate, insurers offer management services under mandate, which allow the saver to delegate the management of his portfolio to a third party, generally a manager of wallet. Savings are then invested and managed according to their risk profile, their investment objectives and their investment horizon, defined in advance with their advisor.
Real estate: an asset class in its own right
In the current context and in view of the extreme volatility of the equity markets and low interest rates limiting the potential of bonds, insurers have, for several years, devoted an increasingly important place to real estate supports in their offer. units of account.
In fact, real estate has attractive characteristics both in terms of intrinsic performance and relative performance compared to other asset classes.
In real estate, intrinsic performance is made up of rental performance, which is often measurable from the start with regard to the firm term of leases, and real estate valuation, which is less predictable and more volatile.
The rental component, in the order of 3% to 5% depending on the type of asset, supports the performance of the asset class over the long term. Even if these rates of return have been falling for several years, the risk premium is still comfortable compared to the risk-free rate. This return, not guaranteed, represents between 30% and 50% of the value of the investment over a period of 10 years.
The capital component, on the other hand, is more volatile and depends on several characteristics. The two main parameters that can have an impact on performance are: the level of rents induced by the supply and demand of available rental space and the volume of available capital ready to be invested in the real estate market.
Relative performance rating, real estate presents a more than attractive performance profile. Indeed, according to the IEIF, over a period of 10 years, office real estate shows an absence of correlation with the financial markets. Thus, in a context filled with uncertainty, real estate thus appears to be the asset class to favor in order to diversify its assets.
This is why insurers are offering more and more units of account with real estate assets: Collective real estate investment organization (OPCI), Real estate investment company (SCPI) or Real estate company (SCI) / Company civil (SC). These investment vehicles have their own characteristics and a specific investment strategy. A specific investment strategy, which, like for equity or bond units of account, will have a strong impact on long-term performance. There is a wide choice to invest in real estate units of account: direct or indirect investment in an asset, sector of activity (office, residential, hotel, logistics, health, etc.), geographical location, etc. New: the application of multi-management to real estate allows savers to invest in several real estate investment strategies through a real estate fund.
Paper real estate has become an essential investment in building and diversifying the financial heritage of savers. It is therefore essential to include it in your life insurance. Less volatile than equities, more profitable than bonds, these real estate vehicles, now present in life insurance, increase the investment possibilities for investors and contribute to the development of their assets.