, a life insurance company with BNP Paribas Assurance, works through partner networks to distribute Creditor Insurance1 in 28 countries and totals 29 million policyholders worldwide.
As the 3rd Creditor Insurance provider worldwide, Cardif detains essential insight on this area to be shared with partners and market contacts. Therefore, in Q1 2005, Cardif conducted the first survey2 on consumer behaviour and expectations regarding the budget protection, with a sample population of approximately 14,000 people in 14 countries: Belgium, Brazil, Chile, France, Germany, Italy, Japan, Netherlands, Poland, Portugal, Spain, Switzerland, Taiwan, United Kingdom.
The survey reveals feelings of vulnerability among sample populations, as regards life's contingencies and financial security. On the average, concern is greater in France than in the rest of Europe :
- Anxiety is highest for « physical» risks
: death, dread disease, road accident, severe incident involving a family member. Fear of unemployment is greater than fear of road accidents, and far greater than fear of divorce or separation. In France, anxiety scores higher than the European average (5.6 vs. 5.3), particularly as regards unemployment (7.9 vs. 6.6)3 and divorce or separation (6 vs 4.6).
- In general, Latin countries, Hispanic populations mainly, and Polish
, feel particularly vulnerable, while populations in Northern Europe, Switzerland and Asia, feel more secure.
- Regarding financial security
, 36% of the working population, 40% of the French survey sample and 51% of populations under the age of 35 believe they would be unable to maintain current standards of living for over three months in case of unemployment.
Overall, nearly 25% of creditors, and 18% in France, declare having had difficulties in meeting monthly credit instalments. In reaction to this vulnerability, the prevalent trend is towards tight monthly budget control
. For example, this is the case for 96% of the survey sample in Germany, 83% in Franc e and 58% in the Netherlands.
And yet, the propensity for consumption, and particularly for credit, remains high in emerging economies, attracted by Western lifestyles, and in mature economies, where populations are focused on maintaining current standards of living.
- In all survey countries, main household expense items
are housing (mortgages or rentals) and utilities (electricity, heating), followed by food and clothing. In France, motor expenses rank third, while the global average ranks medical care in third position. This is probably due to the perceived quality of the French social security system.
1 Creditor Insurance
: unemployment, disability or life insurance to cover payment of loans from banks or financial institutions
2 Survey data collec tion and analysis were conducted by the Corporate Communications Department of TNS SOFRES, the opinion survey specialist. Opinion surveys research subjective data (satisfaction, appreciation, judgment, taste, attitudes,…) as opposed to factual surveys dealing with objective data (purchasing behavior, audience measurement, household equipment rate ...).
3 on a scale from 0 to 10
- Appetite for credit
is especially high in France, Spain, Italy, Poland, Taiwan and Brazil. Among survey countries, credit is most popular in France, where 88% value it as a very convenient consumer solution vs. 61% for the global average and 63% for the European average.
- Overall, acceptance of credit to fund most purchases
is high: real estate (77%, and 88% in France), motor loans, medical care, education, home improvements, and household appliances. Credit is a less natural choice for travel and holidays (10% and only 5% in France).
In such a paradoxical context of both financial vulnerability and propensity for consumption and credit , insurance solutions to cover bills and credit payments in case of unexpected events are very attractive.
- Use of credit seems directly correlated to the degree of awareness
in survey countries. France is clearly ahead, where households are best informed (75% are aware of the concept vs. 50% in other European countries) and where credit is more popular (49% vs. 27% for the European average).
- Insurance coverage for expenses or loans
in case of loss of income is a promising concept, as 64% of sample populations deem it « useful », 26% « essential » and 38% feel it makes life easier . In France, this type of insurance is particularly popular to cover household expenses (94% for mortgages vs. 82% on the average for Europe) and motor purchases (69% vs. 52% for other European countries).
- Among policyholders, a larger share of the survey sample consider creditor insurance as “essential protection” or "as useful”
(81% vs. 69% for non-policyholders), which could mean they are satisfied with the resulting level of security. Cardif
) is the life insurance subsidiary of BNP Paribas Assurance, designing and selling savings and protection products since 1973, through multiple distribution channels. Today present in 30 countries, with strong positions in Europe, Asia and Latin America, Cardif totals more than 150 institutional partners worldwide. Protection gross written premiums reached €BN 2.4 in 2004, up 19% vs. 2003. Cardif is now one of the world leaders in Creditor Insurance.
BNP Paribas Assurance (assurance.bnpparibas.com
) is the insurance arm of BNP Paribas, with over 4,500 staff members, including 2,900 abroad. Gross written premiums reached €BN 11.4 in 2004, 26% of which abroad.