What is Life insurance?
Life insurance is the first means of savings . Insurance contract in the event of life, in the event of death, in the event of life and death … Update on applicable regulations and taxation, as well as unclaimed contracts.
Life insurance is the number one means of saving in french: according to key figures from the French Insurance Federation, life insurance contracts currently total more than 1,700 billion euros.
Life insurance: the main principles
There are three types of life insurance contracts: life insurance, death insurance and a mixed life and death contract. Life insurance guarantees the payment of a capital or an annuity to the subscriber or to the beneficiary designated in the contract.
Insurance in the event of death constitutes a guarantee for the relatives of the insured, while insurance in the event of life is used more as an investment, the insured may himself be the beneficiary of the contract.
Taxation of life insurance
The taxation of life insurance, detailed on the website of the French Insurance Federation, is different according to the contracts and according to the conditions of exit. Thus, beneficiaries of contracts liquidated at the time of death benefit from an exemption from inheritance tax under the conditions specified in the BOI-ENR-DMTG-10-10-20-20 tax documentation.
A single flat-rate levy
Article 28 of the finance law for 2018 establishes a single flat-rate levy in order to simplify and reduce the taxation applying to income from movable capital (interest, dividends) and capital gains, with a single rate of 30% .
Lower-income taxpayers may choose to be subject to the income tax schedule if it is more favorable. The previous regime is however maintained on the life insurance contracts of policyholders whose total life insurance outstanding is less than 150,000 euros.
In terms of income tax, life insurance products fall under a favorable regime set by article 125-0 A of the general tax code and commented on by the tax documentation BOI-RPPM-RCM-10 -10-80. Thus, contracts of more than 8 years benefit, depending on the option chosen:
a reduction of € 4,600 (or € 9,200 in the case of joint taxation) on income tax or a discharge at the reduced rate of 7.5%
Article 125-0 A of the General Tax Code provides for exemption from income tax when the outcome results from dismissal, early retirement or disability.
Article 9 of the finance law for 2020 aligns the taxation of contracts prior to 1983 with the ordinary life insurance regime.
In addition, life insurance contracts give rise to a tax reduction when they are taken out for the benefit of disabled people, up to 25% of the contributions paid, in accordance with article 199 septies of the general tax code.
Law n ° 2007-1775 of December 17, 2007 obliges insurers to find the beneficiaries of expired contracts when they have not appeared and their contact details do not appear in the contract.
The framework for the obligations of insurers in terms of unclaimed contracts is reinforced as of January 1, 2016 by Law No. 2014-617 of June 13, 2014 relating to inactive bank accounts and dormant life insurance contracts. implemented by Decree No. 2015-1092 of August 28, 2015.
This text reinforces the information and research obligations of the beneficiaries of the contracts and specifies the terms of transfer to the Caisse des Dépôts and consignment of dormant assets, as well as the conditions of return of these sums to the holder or of transfer to the State by the CDC at the end of the statute of limitations.
⇒ Inactive accounts: how to get funds returned
The Ciclade site allows you to search for life insurance and inactive accounts paid by banks to the Caisse des Dépôts. Lafinancepourtous.com explains how to find life insurance and inactive bank accounts.
The decree of September 21, 2015 specifies the cap on management fees for inactive accounts.
Decree No. 2015-362 of March 30, 2015 imposes on insurance companies the obligation to declare the subscription, settlement and value of life insurance contracts to the tax authorities as of January 1, 2016. That -ci maintains a file of life insurance contracts, the Ficovie, created by decree of February 29, 2016 modified by the decree of September 1, 2016.
In addition, anyone who believes they are the beneficiary of a life insurance contract taken out by a deceased person can contact the Association for the Management of Information on Insurance Risk (Agira), which is responsible for carrying out the research.
The ACPR, the Prudential Control and Resolution Authority, presents the new provisions on inactive bank accounts and dormant life insurance contracts introduced by the 2014 law known as the Eckert law.
Many life insurance formulas are available depending on the duration chosen and the exit options (payment of an annuity or a capital). The risks incurred by the insured also vary according to the chosen medium: contracts taken out in euros benefit from a guaranteed capital, while the capital of unit-linked or share-based contracts varies according to the markets.
Life insurance contracts are governed by the Insurance Code, in particular Articles L131-1 and L132-1 et seq.
Pre-contractual information in life insurance, the legibility and transparency of contracts have been reinforced by law n ° 2005-1564 of December 15, 2005.