Madelin contract (France)

French law no. 94-126 of 11 February 1994 on individual enterprise, known as the Madelin law, sought to bring the social protection of the self-employed closer to that of employees. The self-employed, craftsmen, shopkeepers, professionals, majority managers, belong to mandatory schemes that protect less, notably for sick leave and disability. The law lets them buy supplementary contracts whose contributions are deductible from their taxable profit, within limits calculated on that profit and the social security ceiling. Four families existed: protection, covering incapacity, disability and death; health; involuntary loss of business; pension. To qualify for the deduction, contracts must be taken out on a group basis, through an association of policyholders, and, for pensions, provide for annuity payout. Since the PACTE law, Madelin pension contracts have not been sold since 1 October 2020 and are meant to be transferred to the retirement savings plan. Protection and health contracts remain. For the insurer, it is a market where medical underwriting and the definition of occupational incapacity matter more than in group business, as there is no pooling through an employer.