France: Key results from Aviva’s global retirement study

• The French are full of paradoxes

Aviva, the world's fifth-largest insurance group and Europe's leading provider of life insurance and retirement savings products, presents the results of a retirement study conducted in April by the independent company, Henley Centre Headlight Vision, using a sample of 26,854 consumers from around the world. In line with its "forward thinking" approach, Aviva hopes that this survey will help it gain a more in-depth understanding of the behaviours and expectations of consumers in relation to money and retirement (France: sample of 1,000 respondents).

First paradox: the French are worried about retirement, do not think they can rely on a State pension, but are not making any provisions of their own.

• The French are worried about their future retirement, slightly more so than consumers in the other countries in the study:
  • 63% are afraid of losing their standard of living as a result of not having saved enough.
  • If they were to receive three times their current annual income, 27% would pay off their mortgages and 18% would invest in long-term savings.
• The French believe that it is the duty of the State to provide for their retirement, but are not confident that it will:
  • 63% of French consumers consider that it is the responsibility of the government.
  • 22% of them think that the government will provide an adequate pension.
  • 63% of French consumers think that will have to work beyond the legal retirement age in order to have a comfortable retirement.
• The French say that they make little provision for their retirement:
  • In France, as in the countries of Eastern Europe, few people prepare for retirement (only 36%).
  • 74% say that they have an investment outlook of less than five years. This rate is higher than in Spain, the Netherlands or Germany. Of that 74%, 40% of French respondents want instant access to their funds.

Second paradox: although lack of purchasing power is often cited as an obstacle to saving, there are many others.

• Ownership of the primary residence is perceived as central to retirement planning:
  • 47% of French consumers think that owning their main residence is an important element of their future financial security.
• The French are lagging behind in regular savings:
  • Only 21% of the French respondents considered that putting money aside each month is the best way of providing for a comfortable retirement. The Americans (49%), Chinese (41%) and Canadians (47%) are much more convinced of the judiciousness of saving regularly.
  • Only 34% of French people regularly save for their retirement, compared with 45% of Americans and 41% of Canadians, who are more aware of the importance of planning for retirement from an early age.
• French consumers are not prepared to join locked savings schemes with no flexibility, particularly with regard to accessing the funds invested:
  • 59% of French respondents said they prefer to know that their money is easily accessible, rather than locked in long-term. This is the highest figure of all the developed countries, together with the Netherlands.
• Although lack of purchasing power is the reason most frequently given for not saving for retirement, there are many others, including paying off loans, low interest rates, risk of losing money, lack of trust in financial institutions.
• Half of French people are wary of investing in the stock market:
  • 53% of French consumers are unwilling to take risks in order to get a better return, while 40% of Americans are willing to take those risks.

Third paradox: in relation to retirement, the French give the impression that they are under confident in money matters, do not know how to go about making provision for retirement and could do with advice and an online educational tool.

• 43% of French respondents did not think they had a better-than-average understanding of money matters.
• French consumers read the financial press much less than their Asian counterparts.
  • In Asian countries, consumers regularly read the money pages in the press: China (42%), India (42%), Taiwan (54%) and Hong Kong (51%).
  • Only 23% of French consumers read the financial pages in the printed or online press.
• When questioned about the idea of an independent website offering retirement planning information:
  • 65% of consumers worldwide said they would be willing to consult an independent website to learn how to plan their retirement.
  • Of all those questioned, 53% of French respondents said they would use such a site.
• Ability to advise is considered a priority by 23% of consumers worldwide, and 21% in France.

Main lessons for Aviva in France

• French consumers need to learn more to help them prepare for retirement. The ability to deliver "Good Advice" to its customers is one of the main qualities that sets Aviva apart in its market.
• The results of the study confirm that life insurance is the type of product that best meets the expectations of French consumers for funding their retirement in a stretched property market. It provides easy access to savings, while offering good long-term performance within a secure framework.

-ends-

The presentation of the main results of the study is available on request.

Press Contacts:
Estelle Joubert 
Telephone: +33 (0)1 7662 5786 
E-mail: estelle_joubert@aviva.fr

Laurent Gibert 
Telephone: +33 (0)1 7662 7300 
E-mail: laurent_gibert@aviva.fr

Notes to editors:

About Aviva
Aviva is Europe's leading provider of life insurance and retirement savings products with strong positions in other markets around the world, particularly in the US. Aviva operates in three main areas: life insurance and long-term savings, asset management and non-life insurance. At 31 December 2006, Aviva recorded turnover of €61.9 billion and had €543 billion of assets under management, making the company the world's fifth-largest insurance group in terms of gross premiums.

With more than 150 years' experience in France, Aviva is one of the top 10 players in the insurance market. Aviva France sets itself apart with a sound and profitable balanced multi-distribution model: 875 general agents, 1,800 branch staff, 400 life insurance advisers, 1,000+ brokers, as well as several partners (Union Financière de France and Médéric). Aviva France also has important partnerships with AFER, the largest savings association in France, and the Crédit du Nord Group. Specialising in unit-linked products, Aviva is recognised for the excellent performance of its long-term funds and solid commitment to its customers through its Good Advice approach. Aviva employs more than 3,200 staff. At 31 December 2006, Aviva France recorded consolidated sales of €6.4 billion, a consolidated operating profit of €689 million (based on the embedded value - EEV/IFRS standards) and managed assets worth €72.9 billion.