Alexa Seleno

Life insurance: choose your investment sector

Juil 10, 2023
Life insurance: choose your investment sector

Life insurance meets the challenge of diversifying savings through a wide range of different unit-linked vehicles. Adapted to the specific preferences of any investor, it takes into account both funds in euros with live securities and real estate funds. This is precisely the question: in which category of media to invest in order to hope for good profitability. We answer them by presenting each type of support.

The euro fund: what is it?

This life insurance backing is the first option most security-seeking investors do. The euro fund offers you a capital guarantee which allows you to recover your initial outlay, after the costs of the contract have been deducted. It should also be noted that each year, any income is generated by the deposited capital, then reinvested in euro funds.

The principle also stipulates that all sums collected be invested in government bonds and bonds issued by companies, thus ensuring the stability and sustainability of the investment. The other role of the manager of this type of life insurance is to invest the funds in the real estate sector to revitalize the profitability of the fund and limit the risks.

However, it is important that you consider your taste for risk as well as your family and financial situation, without forgetting the duration of the investment. Also be sure to carefully read the Key Investor Information Document (KIID) to inform yourself about:

  • Goals ;
  • The investment policy;
  • The risk and return profile;
  • Fees and past performance;

The undertaking for collective investment in transferable securities (UCITS)

A UCITS is an intermediary life insurance option between individual investors and the financial markets. It may hold a large number of assets of different types. It all depends on the manager’s strategy. He must know that he has a duty to ensure a wide diversification of the funds invested in the contract.

As for you, it is important that you know that you do not benefit from any kind of guarantee on the capital that you will have invested.

Real estate supports

This investment choice is called the “stone-paper” and may contain constraints such as limiting arbitrage during the first 3 years of life insurance. You have different options:

  • OPCIs that take real estate and financial markets into account. Here, you are remunerated through both property income and dividends;
  • THE SCPI, more common, which make you acquire a property and then rent it out. Here, you will receive a share of the rents as a dividend.
  • SCIs that offer you enough freedom. They concern both SCPI and OPCI shares and real estate.

SRI and ESG funds

Socially responsible investment funds in life insurance bring together companies involved in sustainable development. On the other hand, environmental, social and governance funds concern companies involved in the employment of people with disabilities, the fight against corruption, the reduction of CO2 emissions, gender equality, etc. .

The lively titles

These are unit-linked stocks or bonds. You have the possibility of entering the capital of companies of all levels, listed on the stock exchanges, as much as if you were the holder of a PEA or an ordinary securities account. But it should be noted that this type of investment in life insurance generates greater volatility and is therefore only accessible to experienced investors.

Finally, you can opt for trackers or ETFs, which duplicate the evolution of the action or of a set of securities. They are characterized by a very interesting performance potential.

The magazine-insurance team of editors at your service! We look at all possible and imaginable information on insurance in order to help you sort it out. We strive to offer you quality articles to help you better understand the issues of this or that insurance.

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