ABI looks to clarify exit charges on with-profits

With-profits providers will have to limit the use of market value adjustments (MVA) under the ABI's proposals to improve the image of the life and pensions industry. In a report drafted for the ABI by consultants Tillinghast Towers Perrin, it is recommended that the MVA is only used to cover falls in the value of assets backing the fund and not to pay for initial expenses such as commission to intermediaries. The consultants suggested that any such costs should be identified as a separate exit charge. The draft paper has been submitted to the ABI's Savings and Long Term Risk project team ...