{"id":135908,"date":"2025-12-01T15:44:00","date_gmt":"2025-12-01T14:44:00","guid":{"rendered":"https:\/\/www.we-wealth.com\/?post_type=news&p=135908"},"modified":"2025-12-23T16:00:55","modified_gmt":"2025-12-23T15:00:55","slug":"unit-linked-policies-the-tax-advantages-lie-elsewhere-the-simulation","status":"publish","type":"news","link":"https:\/\/www.we-wealth.com\/en\/news\/unit-linked-policies-the-tax-advantages-lie-elsewhere-the-simulation","title":{"rendered":"Unit-linked policies: the tax advantages lie elsewhere. The simulation"},"content":{"rendered":"\n

Life insurance policies have historically been offered as an effective tool for reducing the tax burden at the time of inheritance. In their traditional form\u2014with guaranteed capital\u2014this function was clear: upon death, the amount is paid to the heirs quickly and smoothly, protected from any claims.<\/p>\n\n\n\n

However, the proliferation of financial policies (in particular unit-linked<\/strong> policies) has introduced the same volatility as the stock markets into the \u201cinsurance box.\u201d In fact, these products behave more like investments than insurance, partly because market risk is not transferred \u2013 as recognized by recent case law, which is not always favorable to their exemption from seizure.<\/p>\n\n\n\n

In addition to the market risk itself, there are two combined aspects<\/strong> that can make unit-linked products very penalizing<\/strong> in generational transfers:<\/p>\n\n\n\n

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  1. They cost more<\/strong> than pure financial products, eroding capital growth over time<\/li>\n\n\n\n
  2. Redemption takes place when the policyholder dies<\/strong>: therefore, if the markets are falling, the loss is crystallized<\/strong> and the heirs cannot postpone<\/strong> the taxation of capital gains and leave the capital invested.<\/li>\n<\/ol>\n\n\n\n

    This second point is decisive: those who inherit large sums (and use a policy to avoid paying inheritance tax, which is only due on amounts above \u20ac1 million to direct heirs) often have no immediate need for liquidity.<\/strong> In such cases, the capital could continue to work on the markets, delaying the 26% tax on capital gains with enormous advantages.<\/p>\n\n\n\n

    That is why we have simulated the true opportunity cost<\/strong> in the long term.<\/p>\n\n\n\n

    The simulation<\/strong><\/h2>\n\n\n\n

    Initial capital invested: \u20ac2 million<\/strong><\/p>\n\n\n\n

    Horizon considered: 15 years until death + 10 years after death<\/strong><\/p>\n\n\n\n

    Average annual costs (derived from Ivass and Esma):<\/p>\n\n\n\n