What is a Market Value Reduction (MVR)?

An MVR is used to make sure that we treat all our With Profits customers fairly, whether they stay in With Profits or withdraw early. If a plan has a set end date, it is only applied where money is taken out of With Profits before the set maturity end date. Please note MVRs do not apply to benefits paid out on death.

We usually apply an MVR when investment conditions have been insufficient to support bonuses. In these conditions, we will apply a factor to reduce the amount of money switching or transferring out of With Profits to try to balance the interests of those leaving With Profits with the interests of those staying in With Profits to ensure, as far as possible, fairness for all. Whether a switch, transfer or early retirement will suffer an MVR depends on investment conditions at the time money is taken out of With Profits and if that’s before the set maturity end date. For further information on MVRs, please view our MVR flyer.