CNP Assurances in excellent financial health

CNP Assurances, the biggest personal insurer in France since 1991, can demonstrate very strong financial solidity. This can be seen in the fluctuation in the CNP Assurances share price, which has been far more controlled than that of other insurance players since the start of the financial crisis.

Shareholder structure testifies to the solidity of CNP Assurances. The public sector has a 76.56% stake in CNP Assurances capital. The Caisse des Dépôts et Consignations is the biggest shareholder at 39.99%, whilst the French State holds 1.09% of its capital, ensuring exceptional stability for CNP Assurances.

Furthermore, CNP Assurances opted for a security-driven and prudent management policy for its investments to preserve the interests of its clients. The quality of its bond portfolio is excellent: at 31 August the proportion of Treasury bonds (State and public sector) in the portfolio held by the CNP Group (excluding international subsidiaries) amounted to 57.1%, whilst the proportion of bonds graded A to AAA amounted to 96.6%.

CNP Assurances has no direct exposure to sub-prime risks, which are what sparked the current crisis. Its indirect exposure the US mortgage market, in particular through guaranteed capital structures and diversified funds, amounts to less than €10 million, in other words almost a zero percentage of CNP Assurances’ managed assets, which amount to €230 billion.

Here is a particularly significant testimony to the financial solidity of CNP Assurances: at 30 June 2008, CNP Assurances’ coverage of its regulatory margin requirement (its solvency margin) was... 185%

Life insurance: a solution tailored for the long-term view

Life insurance policies are taken on with a medium to long-term perspective. This is the most appropriate timeframe in which to assess the investment and make any decisions. Your assets must remain organised according to your plans and family situation.

Life insurance policies have many benefits to offer and ensure a solution tailored to plans for future needs.

As a flexible product, life insurance can help finance all kinds of plans: bequests to a person of one’s choice, retirement (with the payment of a regular income) and also savings to deal with life’s difficulties or finance a real estate project.

Life insurance also makes it possible to invest in policies in Euros, an unparalleled product on financial markets in terms of secure and regular yields, as well as in a plethora of unit trusts to seize market opportunities with minimum payments that are often more affordable than equities accounts.

Life insurance affords protection against risks with benefit guarantees (minimum term guarantees, for example to protect amounts paid to beneficiaries).

Of course, life insurance is a product which enjoys special tax breaks, as taxation is lower after eight years of contributions. Life insurance is also particularly useful when planning estate provisions: death benefits paid to beneficiaries under a life insurance policy are not subject to death duties, which optimises estate planning and, under specific conditions, offers policyholders in France far more latitude in designating beneficiaries.

Regulations covering insurance companies provide very strong protection for insured parties

Assets held with life insurance policies are subject to prudential rules established for insurance companies to dispel any risk of hazardous investments.

The insurance company’s solvency and match between the value of its assets against its commitments are regularly monitored by the French Autorité de Contrôle des Assurances et Mutuelles. The ACAM implements a procedure to preserve the interests of policyholders when an insurer’s solvency is at risk. The procedure stipulates that savings are guaranteed with a ceiling of €70,000 per client and per establishment in life insurance. The ceiling amounts to €90,000 for annuities arising from an insurance policy in the event of death and disability or invalidity annuities. The procedure may be used as a final resort only after the mutual contribution of other insurance companies and above all after shareholders have become involved. It should also be remembered that in the case of CNP Assurances, 76.56% of the company is owned by the public sector.