Life insurance: Afer’s euro contract falls from its pedestal

The Afer euro fund, long one of the best on the market, is in trouble. This contract, subscribed to by 750,000 savers, will yield only 2.22% for 2023 (net of management fees and excluding social security contributions at 17.2%). An increase in yield over one year (0.21%) but disappointing, given the rates displayed by the competition.

A certain number of insurers have already come out of the woodwork announcing rates around 3% for the year 2023. (Garance at 3.50%, La France mutualiste at 3.70%, MACSF and Generali at 3.10% , GMF Vie at 2.80%, Milleis Vie at 2.75%, Macif 2.50%, etc.). The average return should be between 2.50 and 2.70% according to the specialized site Good Value For Money. “We are not the best, but we are going to become so again,” said Gérard Bekerman, president of Afer, when announcing the association’s rate.

To achieve attractive remuneration, insurers have for the most part increased their remuneration rates substantially (around 0.8% compared to 2022). To do this, they drew on their reserves (the provision for profit sharing) which were set up for this purpose. But Afer has few reserves. “We don't give what we want to shine. We give what we can to ensure the security of our savings over time,” argued Gérard Bekerman. Since 2005, the Afer euro fund has returned 3% on average, highlights the association.

Last year, the Euro life insurance fund lost nearly 25 billion euros, according to France Assureur. The Afer euro fund does not escape this blow. Net collection (payments – deaths – redemptions) is negative -900 million euros. The association, whose audience is elderly, has been penalized by increasing withdrawals, linked to deaths. Their number is “slightly increasing”, recognizes Afer. They represented 1.6 billion euros. The fund's assets in euros are 41 billion euros.

The year has not been good for the historical players in life insurance. This investment must face competition from other investments (livret A, term accounts) which are taking full advantage of the surge in interest rates in recent months, and offering remuneration in excess of 3%. That's not all, new, very profitable offers are arriving on the market, taking advantage of this new environment. Corum Life, launched in July, thus offered 4.45% - annualized return - for 2023 when placement direct.com displays 4.10%. But these players have very little weight compared to the 1,383 billion euros in euro funds, managed mainly by bancassurance companies and associations like Afer.