What can become 20,000 euros placed on life insurance for ten years? For illustration, with a average annual return of 5%the capital could reach 32,578 eurosexcluding fees, taxes and additional payments. However, this performance is not automatic. It depends in particular on the risk profile of the saver and investment supports retained.
A cautious profile, invested mainly in a fund in euroswill seek above all security of capital and will generally obtain a more limited return. Conversely, a balanced or dynamic profile, more exposed to units of accountmay aim for higher performance potential, in return for a greater risk of capital loss. “What will determine a good investment in a life insurance contract are firstly the costs, but also the risk-return couple”explain Habib ATTIKfounder of ECP.
Fees can weigh heavily on final capital
Displayed performance is only part of the equation. THE fees on paymentTHE management feesTHE arbitration fees or the costs specific to investment supports gradually reduce the performance of the contract. The longer the investment horizon, the more their impact is felt.
According to Habib ATTIK, payment fees greater than 2% must encourage vigilance. Management fees should ideally remain below 1% per year, or even around 0.60% for the most competitive contracts. L’Financial Markets Authority (AMF) also recommends carefully examining the fees as well as the characteristics of the media before any subscription.
Contract allocation is just as decisive
The distribution between fund in euros And units of account directly influences the performance of life insurance. “It is necessary to check that the contract is not limited to the euro fund and that it offers a sufficiently diversified allocation according to the risk profile of the investor”underlines the expert.
An investment horizon of ten years generally makes it possible to adopt a more dynamic allocation by integrating moreETFsofbonds or other investment vehicles. According to France Assureurs, the rate used on euro funds stood at 2.6% in 2025. Units of account offer greater performance potential, but they also expose the saver to a risk of capital loss.
After eight years, taxation becomes more advantageous
Life insurance is also appreciated for its tax regime. In the event of redemption, only the winnings are imposed. After eight years of holding, the saver benefits each year from a reduction of 4,600 euros on the products withdrawn (9,200 euros for a couple subject to joint taxation). Beyond this reduction, the winnings remain subject to the social security contributions of 17.2%. For payments made from September 27, 2017the products are subject, depending on the case, to a fixed levy of 7.5% (under conditions, in particular of outstanding) or 12.8%to which are added social security contributions. This taxation constitutes one of the main advantages of life insurance for savers who invest for the long term.
Regular payments reinforce compound interest
Initial capital is not the only performance lever. Of the scheduled payments make it possible to invest progressively while reinforcing the effect of compound interest. For example, with an initial investment of 20,000 eurossupplemented by 200 euros per month for ten years and an average annual return of 5%the capital could exceed 60,000 eurosexcluding fees and taxes.
