FRANCE Trends and Developments Contributed by: Martine Samuelian, Olivier Lyon Lynch and Hugues Vaysset, Jeantet
Introduction The French insurance market showed upward momen- tum in 2025. In life insurance, flows reached an excep- tional level in the first half of 2025, with net inflows into redeemable products exceeding the amount collected for the whole of 2024, while in non-life insurance, the increase in premiums (+5.4%) exceeded that of claims (+2.3%), improving technical profitability. In addition, the average solvency ratio stood at 241% at the end of June 2025, reflecting the financial strength of play- ers in the sector. This favourable environment has nevertheless been the subject of several structural projects requiring par- ticular attention from market players, notably: • The revision of Solvency II with new governance, liquidity and sustainability requirements. • The entry into force of the Digital Operational Resil- ience Act (DORA) and its 2025 technical standards, which impose a strengthened framework for digital operational resilience. • Clarifications on certain expectations of the French Prudential Supervision and Resolution Author- ity (ACPR) regarding the distribution framework, including the extension of the duty to advise and increased marketing requirements, as well as recent debates on distribution from third countries. • The ACPR continued supervision of the insur- ance sector, maintaining a high level of control and demonstrating its ongoing vigilance with regard to insurance companies. In addition to an introduction on the macroeconomic situation of the insurance and reinsurance market in France, this article aims to summarise the main chal- lenges for 2026. Overview of the French Insurance Market Life insurance: exceptional inflows driven by unit- linked products and pension products According to the analysis of the “Situation of insur- ance in France in the first half of 2025”, published in November 2025 by the ACPR, in the first half of the year life insurance generated record gross inflows of EUR84.7 billion, a decline in redemptions and net inflows of EUR25.2 billion in the first half of 2025, with
arbitrage in favour of unit-linked products. Redemp- tions fell by 11.2% and claims declined slightly. This performance reflects several structural trends: the search for returns in an environment where inter- est rates remain attractive, a growing appetite for unit-linked products in a context of asset diversifica- tion, and the success of retirement savings schemes encouraged by the public authorities. Improved technical profitability in non-life insurance Non-life insurance premiums rose by 5.4%, while claims increased by 2.3%, bringing the net com- bined ratio to 95.9% at the end of June, reflecting an improvement in technical performance. However, motor repair costs are set to rise steadily over the 2022–2024 period, requiring particular vigilance in terms of pricing and claims management in this line of business. Stable asset allocation French insurers’ investments amounted to EUR2,738 billion at the end of June 2025, with a stable alloca- tion, a high proportion of high-quality liquid assets and exposures mainly concentrated in France and the European Union. Net unrealised capital gains are posi- tive across all investments. This asset structure reflects prudent management and a preference for liquidity and credit quality, in line with the prudential requirements of Solvency II. Solvency on the rise The average solvency ratio stood at 241% at the end of June 2025, with different levels across segments: 231% for life and mixed insurers, 227% for bank insurance companies and 285% for non-life insurers. This improvement was seen across many sectors and affected all types of insurers in the first half of 2025. These high solvency levels give French insurers the capacity to absorb shocks and the leeway to invest in digital transformation, regulatory compliance and commercial development.
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