A French assurance-vie paid out on death is not part of the estate: the money goes straight to the named beneficiaries under its own tax rules. For premiums paid before the insured turned 70, each beneficiary receives €152,500 tax-free, then pays 20% and 31.25% above, whatever their relationship to the deceased. For premiums paid after 70, only €30,500 is exempt in total. A spouse or PACS partner pays nothing. For expats, the key question is where the insured and the beneficiary live on the day of death.
Key facts
| Question | Short answer |
|---|---|
| Part of the estate? | No, if a beneficiary is named |
| Premiums paid before 70 | €152,500 tax-free per beneficiary, then 20% and 31.25% |
| Premiums paid after 70 | €30,500 tax-free in total, then inheritance tax; growth is exempt |
| Spouse, PACS partner | Exempt |
| Family ties | Irrelevant before 70: a nephew or a friend pays like a child |
| Insured lived in France | Taxed in France, wherever the beneficiary lives |
| Insured and beneficiary abroad | In principle no French tax on before-70 premiums, unless the beneficiary has lived in France 6 of the last 10 years |
| No beneficiary named | The money falls into the estate |
Why assurance-vie sits outside the estate
The beneficiary receives the money under the insurance contract, not as an heir. Two consequences follow:
- Its own tax rules, separate from inheritance tax, depending on the insured's age when the premiums were paid.
- Children generally cannot claim their reserved share from it, unless the premiums were manifestly excessive compared with the policyholder's income and wealth.
This only works if a beneficiary is named and alive at death. Otherwise, the capital falls back into the estate.
Premiums paid before 70: €152,500 per beneficiary
| Share of each beneficiary | Rate |
|---|---|
| Up to €152,500 | 0% |
| €152,500 to €852,500 | 20% |
| Above €852,500 | 31.25% |
The allowance applies per beneficiary, across all contracts on the same insured, and covers capital and growth. Family ties do not matter. That is where assurance-vie makes the biggest difference: €300,000 left to a nephew costs about €29,500 through assurance-vie, against about €160,600 through the estate. For a child, the €152,500 allowance comes on top of the €100,000 inheritance allowance.
Premiums paid after 70: a different rule
Only the premiums are taxed, not the growth. One €30,500 allowance is shared by all beneficiaries and all contracts. Above it, premiums are added to the beneficiary's share and taxed at normal inheritance rates, with the usual allowances (€100,000 for a child).
When the insured or the beneficiary lives abroad
For premiums paid before 70, what counts is the situation on the day of death. France taxes the payout if:
- the insured lived in France, wherever the beneficiary lives; or
- the beneficiary lives in France and has done so for at least 6 of the previous 10 years.
So a French contract held by someone living abroad at death, paid to a beneficiary who also lives abroad, is in principle outside this tax. Where you lived when you opened the contract does not matter.
The after-70 portion is different: money owed by a French insurer is in principle a French asset, so it can be taxed in France even if everyone lives abroad, unless an estate tax treaty says otherwise.
One trap: the French tax on before-70 premiums is generally not covered by estate tax treaties. If the beneficiary's country also taxes the payout as an inheritance, the same money can be taxed twice.
Americans and assurance-vie
For the same reason, the US-France estate treaty is generally not seen as covering this tax. On the US side, how a French policy is treated for income tax and reporting needs a separate review with a US adviser before you fund it. Some French insurers also restrict contracts for US persons.
Moving in or out of France
You can keep your assurance-vie when you leave France; nothing forces you to close it. Some insurers limit new payments from residents of certain countries. If you move to France with a foreign life insurance contract, you must declare it every year with your French tax return, and at death it follows the same French rules.
Writing the beneficiary clause
- Always name a second-rank beneficiary: if the only beneficiary dies first, the money falls into the estate.
- "My spouse" means whoever you are married to at death; an ex-spouse named personally stays the beneficiary unless you change the clause.
- Identify beneficiaries precisely: full name, birth name, date and place of birth.
- Once a beneficiary formally accepts, the clause becomes irrevocable and you can no longer withdraw without their consent.
- Update the clause after a marriage, divorce, birth or a child moving to another country.
What may change in 2027
The 2027 French budget bill, filed on 1 October 2026, would add new conditions: premiums paid in cash, eligible underlying assets, and no securities linked to the policyholder or their family in dedicated funds. A contract that fails them would be fully taxed at inheritance tax rates, for deaths from 1 July 2027. It mainly targets foreign contracts with dedicated funds. The text may still change in Parliament.
Life insurance and family in more than one country? A short consultation is enough to check who will pay what.
Frequently asked questions
Is assurance-vie part of the estate?
No, as long as a beneficiary is named and alive at death.
How much can I pass on tax-free?
€152,500 per beneficiary for premiums paid before 70, with no limit on the number of beneficiaries, and unlimited to a spouse or PACS partner.
Can a non-resident keep a French assurance-vie?
Yes. Check your insurer's rules for your new country and the tax treatment there.
Does a beneficiary living abroad pay French tax?
Yes if the insured lived in France at death. If both lived abroad, the before-70 capital is in principle outside the French tax, but the beneficiary's own country may tax it.
Related reading
- French inheritance tax: rates, treaties, forced heirship
- France's 20% tax on homes, yachts and cars held through companies
Two ways to move forward
You are planning ahead. You hold life insurance in France or abroad and have family in several countries. Book a consultation.
You are a beneficiary. An insurer has contacted you, or you think you are named on a contract, and you need to know what you owe and where. Describe your situation and you will receive a proposal for full assistance.
General information under French law as at 31 October 2026. It is not legal advice for your situation.