If you're in France, you are required by law to take out home and car insurance. Both are linked to responsabilité civile, making you financially responsible for bodily or material damage to a third party. A tenant is liable for damage to the landlord's property, including the common spaces of an apartment building. French insurance is renewed automatically every year. If you wish to cancel it, inform your insurer in writing at least one month before the expiration. If you don't, the policy is renewed and you are obliged to pay.
Insurance is dominated by state-controlled joint-stock companies like GAN, AGF and UAP. Their competitors are the mutuelles grouped by profession or region and include the MACIF, GMF and MATMUT. Mutuelles do not use brokers or agents and therefore offer low prices, in theory at least. International insurance groups are also present in the French market, including well known British names like Commercial Union and General Accident.
Contrat multirisque habitation covers you for theft, fire, storms, floods, burst pipes, explosions, lightning, broken windows and natural disasters, and may also give third-party coverage to your family (responsabilité civile familiale). Valuable objects can only be insured up to a proportion of the total insured value of your contents (often 30 percent). Additional coverage can be taken out.
Premiums vary according to number of rooms, neighbourhood and the floor you live on. If your home is unoccupied for long periods, let your insurer know. Many policies do not cover your home beyond a specified absence. Some insurers insist on insuring your principal residence before they insure a holiday home.
The level of insurance fraud in France is quite high, and as a result insurance companies are quite exacting on claims. Security measures are carefully specified. To claim for a burglary, a police report is necessary. Most insurers will assume that you have been negligent in maintaining security unless their are visible signs of forced entry into your home.
There are three types of protection: third-party (au tiers), the legal minimum; third-party fire and theft (au tiers illimité or tiers complet); and comprehensive cover (tous risques). Specialised packages are also available, and an optional protection du conducteur can be added, compensating for incapacity to work following driver injury. Costs depend on your accident and claims record (bonus-malus). It is thus important to prove your claims record if you were previously insured with a foreign company, who will give you documentary proof. If insured in the UK., a last renewal notice or photocopy of your contract should be sufficient. To drive in France, the green insurance card (carte verte) and tax disk (vignette) must be displayed. If you have an accident involving another party, fill out an accident report form (constat amiable), supplied by your insurers and identical in all EU countries. Fill in the form in English if your French is shaky.
When you move, your existing life insurance usually continues to apply, provided you continue to pay the premiums. If you are not insured, now is the time. Banque Transatlantique takes care of this for you and looks after special regulations. As a member of the GAN, they are well placed to answer these and all insurance needs. A French life insurance contract is suitable if you intend staying in France long-term.
Life insurance (assurance-vie) can protect your family against serious loss, and tax advantages make it interesting as a savings or retirement plan. The insurer guarantees a capital sum on expiration of the contract, conditional on payment of premiums. It goes to beneficiaries should you die before the contract expires. Under another option, if the insured is living at contract's end, the lump sum converts into an annuity to provide a regular income during retirement, or capital may be reimbursed unconditionally by a fixed date.
Investments are subject to capital gains and estate taxes, but taxation on life insurance is flexible, with an annual tax reduction of 25% of the investment, subject to thresholds. The amount saved is not subject to capital transfer taxes. And capital goes to beneficiaries without estate duties if the contract is taken before age 70.
A life assurance policy is a good alternative to a Trust, which is not legislated for in France. As an industry representative told us, "The widely practised Continental alternative is for a policy-holder to appoint a beneficiary, so that the policy passes to that person on the policy's maturity or the death of the policy-holder, and the forced heir-ship rules are effectively by-passed."
For a list of insurance companies, please click on The Yellow Pages