MGM Assurance has put MVAs on any surrender or switch from its unitised with-profits products. The...
MGM Assurance has put MVAs on any surrender or switch from its unitised with-profits products.
The MVAs, which do not apply to surrenders under £10,000 or to income taken at a level of 7.5% or less, apply to the group's life and pensions Bonus Growth fund and With Profits Bonds series 1 to 5.
The level of the MVA applied is related to the length the policy has been in existence. Policies taken out in the past 12 months will have an MVA of 6%, those between one year and three years will have an MVA of 14%, while those in existence for longer have an MVA of 6%.
Neil Walker, chief operating officer of MGM, said: 'We have put the MVAs in place to protect the remaining policyholders. We do not want people taking more than their share of the assets.'
Blaming the ongoing equity slump for the introduction of the MVAs, Walker said there has been no increase in the number of redemptions from the products.
More than £3bn transferred
Available to 80,000 employers
Covered call option strategy
Impact on markets
Cunningham Coates wealth manager