What is life insurance?
A life insurance contract is a way to invest in different financial products such as funds in euro and units of account. The saver pays the capital and the insurer manages the investment, redistributes the profits (plus-values, dividends) either to the saver or to the beneficiaries at the end of the term or in rent.
Life insurance is flexible, evolving according to your needs thanks to various management techniques, types of payments and arbitrations.
The different types of payments
The investor has three options for feeding life insurance:
- One single payment at subscription
- The periodic payments according to a predefined plan
- No regular payments, depending on the availability of funds. The only condition is the minimum amount allowed.
Repurchase of life insurance
The saving phase of the life insurance contract is not fixed. Premium payments are possible, as are the withdrawals and redemptions. The saver can recover his funds via:
- One partial buyback to free up some of the funds.
- One total redemption to recover the entire capital and close the contract.
Want to know more? See our comprehensive life insurance buyback guide.
Arbitration and life insurance management
Insurers offer various forms of management for life insurance. You have a choice from:
- The free management where you manage your own investments. You decide on the allocation of funds and make the arbitrations. This mode is not suitable for novices and requires a solid knowledge of the financial sector.
- The piloted management where management is entirely entrusted to the insurer or to a manager. Ideal for beginners, this option is offered only by Nalo Life Insurance.
- The Profiled management makes it possible to invest under the eye of a professional. You choose your investment profile and the level of risk (from very risky to secure).
It is up to you to choose the most suitable management option for your profile (beginner, expert) for your life insurance.
Why opt for life insurance?
One life insurance contract can be used as a savings product. In addition to many tax and estate benefits, there are other less well-known benefits.
Succession
In the event of death, life insurance can be used to transfer capital without inheritance taxes or with tax advantages according to the amount and age of the insured person at the time of payment.
- The type of beneficiary designated in the clause
- Age of insured person at time of payment (before and after age 70)
- Age of life insurance contract
- The amount of the capital transferred.
For more details, see our life insurance estate file.
Taxation
Savers looking for an interesting investment and tax benefits can find their happiness with life insurance. After a few years, the taxation becomes more advantageous. The saver can choose between lump sum relief, progressive tax or other tax options.
Need more information? See our guide on taxation and life insurance.
Liquidity of funds
Unlike other savings products, life insurance funds are available Anytime. They are not blocked, which allows access to its capital if necessary.
However, before 8 years, taxation is a little less lenient. You can limit taxes by spreading withdrawals over several years.
Accessibility
Today,life insurance is accessible to all. Many contracts offer first payment of EUR 100making it affordable to all savers.
There is no minimum amount or maximum investment limit.
Controlled risk
Life insurance can be adapted to your risk tolerance. The Investment media are designed according to the risk that you are willing to accept.
- Bold placement with 100% in units of account
- Contract 100% funds in euros, risk free for capital
- Balanced distribution between funds in euros and units of account.
The support of an insurer or broker is key to helping the investor throughout the contract.
On what to invest with life insurance?
Two options are available for a contractlife insurance:
- A single euro fund contract, guaranteeing capital without risk of loss.
- One Multi-support contract Including units of account and funds in euros, with higher but more risky yield potential.
How to choose the ideal life insurance?
This savings product is very popular in France for its tax advantages. Income by the Investment support are fiscally advantageous.
Think about your goals and motivations before you start. Knowing the specifics of a contract allows compare effectively available options. This ranking of best contracts can guide you. You will find the Key concepts of life insurance.
For more information, see our ranking of the best life insurance 2021.
Define investor profile
Think about the level of risk you're willing to take. Are you reluctant to risk or prefer to secure your savings? This will help you choose the right contract.
All life insurance do not offer the same investments. Some contracts rely on secure investments, others on risky assets. Managers (insurers, brokers, banks) offer a variety of advice.
Life insurance: a long-term investment
It is perfect to prepare for the future: travel, retirement or succession. Minimum period for a contract is 8 years to maximize the tax exemption. Tax only applies to earnings (interest, capital gains). The contract is exempt from tax throughout the savings phase.
Funds are available at any time, but after 8 years, taxation is more advantageous.
If you have any short-term objectives, prefer another savings product like the LDD or Booklet A.
The funds in euro life insurance: secure your savings and understand how it works offer an ideal solution for those looking for a safe and efficient placement.
For a detailed analysis of yields and specificities, see our guide dedicated to AFER SFER: key features and performance.
To better understand the subtleties of this financial investment, discover Life insurance explained to invalids: operation and benefits in 2025.
The level of profitability
It's important to choose the best insurance. Compare the formulas on the market. The returns of funds (in euros, units of account) must be published, so you can predict the performance of a contract.
Investment support available
Two options for your life insurance contract:
- A single euro fund contract: This product is safe and protects your capital.
- A multi-support contract: mix of various assets (shares, SCPI, etc.), more risky but potentially more profitable.
The cost of life insurance
Insurers determine the costs of insurance, including management fees. These Fresh influence future performance. It is essential to compare fees to maximize your performance.
We distinguish:
- Subscription fees paid upon signature
- Payment fees, a percentage (between 2% and 5%) on each premium
- Annual management costs of funds in euro or units of account
- The costs of arbitration to modify the distribution of funds invested. Fixed or percentage.
It is recommended that: focus on low management costs (less than 1%, ideally between 0.60% and 0.75%). Some online brokers and banks offer this free, attracting comparatively more than traditional insurers.
Want to know more? See our guide on life insurance costs.
How to purchase life insurance?
The French life insurance market is growing (EUR 1,783 billion in 2020). It is composed of various actors: traditional insurers, banks, online brokers. Each offers various services and options, with specific fees. Compare according to the key criteria described in this guide is crucial: investor profile, available media, returns, fees, etc.
Any French tax resident can take out life insurance (even minor with parental agreement). We recommend that you sign up as soon as possible to enjoy the long-term benefits.
Top 3 best life insurance this year
Discover the top three life insurance companies with all the information you need to optimize your investments.
Linxea Spirit 2: To diversify its investments
Linxea Spirit 2, proposed by Spirica, combines low management fees and high yields. For novices and experts, this insurance allows to invest in euro funds and units of account. For example, the Euro Climate Target Fund achieved a return of 3.31% in 2024, very attractive compared to the market average.
Lucy Cardif: For secure returns
Lucy Cardif of BNP Paribas Cardif offers good returns on euro funds with possible bonuses. Ideal to secure your savings while achieving correct performance. In 2024, the general euro fund earned 2.75%, with bonuses of up to 4% under certain conditions.
Evolution Life : Compromise between performance and security
Evolution Life, d