1998-Paribas Annual Report - BNP Paribas
1998-Paribas Annual Report - BNP Paribas
1998-Paribas Annual Report - BNP Paribas
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26<br />
L IFE INSURANCE<br />
AND ANNUITIES:<br />
ESTABLISHED in 1973, Cardif is an insurance company<br />
which develops, manages and distributes a complete<br />
line of savings contracts and annuities, targeting individ-<br />
uals and businesses alike. ■ Its steady growth reflects<br />
specialization within specific markets – life insurance,<br />
borrower’s insurance, pension plans – as well as its multi-<br />
distribution approach: Cardif products are sold through<br />
banks and 1,600 independent financial advisors, in addition<br />
to its direct network. ■ Today, Cardif products are sold<br />
in 19 countries.<br />
CARDIF<br />
<strong>1998</strong> in review<br />
France<br />
Reflecting ongoing changes in the French tax<br />
system, new inflows in life insurance products<br />
fell by 15% in <strong>1998</strong>, from the particularly<br />
high level of the prior year, when savers had<br />
anticipated changes in the tax code.<br />
Unit-linked contracts were less affected, as these<br />
products offer higher returns than French francdenominated<br />
contracts, which were hurt by<br />
lower interest rates. Consequently, unit-linked<br />
contracts greatly increased as a percentage of<br />
total new inflow.<br />
A pioneer in unit-linked contracts since 1981,<br />
and for several years the leader in the French<br />
market – over 50% of mathematical provisions<br />
are expressed in units at market price –, Cardif<br />
proved more resilient than the French market as<br />
a whole. The company also strengthened its<br />
position among the leading group retirement<br />
insurance providers, and is France’s leading supplier<br />
of borrower’s insurance.<br />
This leadership position has enabled Cardif to<br />
gain market share. Revenues fell by 9% to EUR<br />
1.8 billion (FRF 12.1 billion), a far smaller<br />
decline than the market as a whole.<br />
Cardif also reinforced its positioning as a leading<br />
provider of innovative products and services. In<br />
February, Cardif demonstrated its expertise in<br />
unit-linked contracts by being the first company<br />
to launch “D.S.K.” contracts, named after the<br />
French Minister of Finance. These contracts<br />
must be made up of at least 50% in French equities,<br />
including 5% in unlisted shares.<br />
The key driving force behind the achievement of<br />
Cardif’s strategic objectives is its painstaking
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