If you’re wondering if bitcoin will ever attain wide-scale adoption, look no further than France. French insurance companies can soon include cryptocurrencies in life insurance contracts, thanks to a vote by France’s National Assembly.
Deputies overhauled the Insurance Code via the Pact Act, with Article 21 swinging open the door for life insurance contracts to invest in specialized professional funds (SPFs), whose investment parameters have reportedly been “relaxed” as a result of yet another provision. Article 26 gives the SPFs the freedom to invest in blockchain-backed assets. Simmons & Simmons Attorney Emilien Bernard-Alzias told local publication Les Echos:
“With these two provisions, it is written in black and white that SPFs can invest in cryptocurrencies like bitcoin.”
Meanwhile, with no cap on the amount of crypto a life insurance policy can hold, French locals have a chance to bolster the value of their policies in the bitcoin bull market.
Bitcoin didn’t make its way into France’s life insurance market overnight. Policymakers alongside entrepreneurs and companies worked together for more than a year to make the rule change happen. In the end, investing in crypto is a byproduct of the updated code, not necessarily the intention. Nonetheless, it could set the stage for other jurisdictions to follow suit as France gains a first-mover advantage. Assemblymember Joel Giraud is cited in Les Echos as stating:
“This was not the primary goal of Pact, but insurers will actually be able to offer products based on crypto-assets. They will be able to do so through specialized funds,” stated
Assemblymembers adopted the measure in recent days, with 147 votes in favor, 50 votes against, and 8 abstentions. The vote, however, reflects only about one-third of the 577 seats comprising the Assembly. Economy Minister Bruno Le Maire was pleased with the results.
“Very happy with the adoption of the law PACT! The vote is wide, thank you to the majority for your total support and for all the work that has been done. We are determined to continue transforming our economy,” said Le Maire
The inclusion of crypto in the Pact Act, even if indirectly, is kind of a big deal. France’s life insurance market is reportedly comprised of EUR 2.2 trillion in assets, and French residents tend to rely on these products for their investment and retirement savings, too, on account of tax benefits. In fact, insurance policies reflect 40% of financial assets among French households, surpassing that of securities, cash, and other savings products.
French investors have also flocked to insurance products for savings because in recent years returns have trumped those of other savings products. Now that bitcoin has entered the equation, the French haven’t seen anything yet.
Last modified: March 4, 2021 2:44 PM