MVR Penalty?



MVRs – Market Value Reducers – are applied by With-Profits companies to reduce the value of your policy. They are in effect a penalty.

This means that your true policy value may not be what it appears.

If, for example, you see that your policy is currently valued at £30,000 and you want to access this via a surrender or transfer of your plan – the surrender or transfer value may be £20,000.

The MVR is therefore, in this example, £10,000 (i.e. the reduction from £30,000 to £20,000).

MVRs are a mechanism to reduce values to stop policyholders taking their money out of the with-profits fund at a value above the underlying asset value.

MVRs can come and go and the amount of the penalty can vary (in some cases almost daily).

They are a frustrating and, often, confusing aspect to working out how well your policy is really performing, what its true value actually is and they effectively undermine the principle of with-profits investing, because they debunk the idea that with-profits are steady and reliable investments.

If you have a with-profits plan subject to an MVR then we can help.

If you are not sure if your with-profits is subject to an MVR then we can find out – and also tell you how likely it is that you could be subject to one at any time.

In either case use our review service to gain our help and support.

The various factors surrounding MVRs can be complicated; sometimes they may be avoided (if not fully, at least in part) by making small, regular withdrawals, or they may apply today but are guaranteed not to apply at a certain point in the future. The reason why an MVR is being applied could be influential (for example is this likely to be a temporary position or does it seem more permanent).

Should you wait and see if the MVR position improves or the MVR disappears; or is the penalty worth taking today? It is possible the bigger ‘penalty’ is actually NOT acting NOW and allowing the penalty to influence you to stay with a policy when it is, in fact, doomed as a long term investment.

There are so many aspects to consider, to weigh up. This needs careful, expert analysis and the best way to gain a proper understanding of your position, your options and what decisions you can take are to get a personalised report. We have helped many people who have faced MVRs over the years.


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MVRs are an invidious part of the with-profits landscape, but the position can often be managed and the options for successfully dealing with them may be greater than you realise.

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If you would like a free review of your With-Profits policy please fill in the form below.