The policyholder's right to take back all or part of the savings before maturity, a source of liquidity for them and of liability risk for the insurer.
Surrender is the policyholder's right to end a savings contract, in whole or in part, and take back its accumulated value. Not every contract can be surrendered: term life cover, an annuity in payment or a compulsory group scheme cannot, because there is no individualized savings pot to return. For the insurer, the surrender option is the main liability risk on a life balance sheet: it turns a thirty year commitment into a debt payable on demand, and it fires en masse at the worst moment, when rates rise and newer contracts credit more, precisely when the bonds held are worth less. Since 2016 the French regulator has held a power to suspend surrenders temporarily so that a run cannot force asset sales. Taxation, which rewards holding period, also works as a deliberate brake. The problem solved is the saver's liquidity, without which life insurance would be an investment in name only and an irrevocable commitment in fact.
Beyond eight years of holding, gains withdrawn benefit from an annual allowance of 4,600 euros for a single person and 9,200 euros for a couple, then a levy of 7.5% up to 150,000 euros of premiums paid and 12.8% above it since the 2018 budget act. That eight year threshold explains the stability of a French market holding more than 1,900 billion euros.
valeur de rachat, rachat partiel