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MVA Secret

Understanding Market Value Adjustments (MVAs)

At Annuco, LLC, we believe in empowering our agents and their clients with knowledge and insights to make informed decisions about their annuity contracts. Market Value Adjustment (MVA) is a crucial aspect of annuities that can impact contract values under certain market conditions. Here’s what you need to know about MVAs:

What is an MVA?

Market Value Adjustment (MVA) is a provision commonly found in fixed or indexed annuity contracts. It allows for adjustments to the contract value based on changes in interest rates or market conditions. When interest rates rise, the contract value may decrease, and when interest rates fall, the contract value may increase.

How Does an MVA Work?

When a policyholder surrenders or withdraws funds from an annuity contract during the surrender charge period, the MVA may be applied to the withdrawal amount. The purpose of the MVA is to protect the insurance company against interest rate risk by adjusting the surrender value based on prevailing interest rates at the time of withdrawal.

Key Points to Consider:

• Impact on Contract Value: MVAs can result in fluctuations in the contract value, especially during periods of changing interest rates.
• Surrender Charges: MVAs are often applied in conjunction with surrender charges, which may further impact the amount received upon withdrawal.
• Market Conditions: The magnitude of the MVA is influenced by prevailing interest rates and market conditions at the time of withdrawal.

How We Can Help:

At Annuco, our team of experts is well-versed in navigating the complexities of annuity contracts, including the implications of MVAs. We provide personalized guidance and support to help agents understand the impact of MVAs on their clients contracts and make informed decisions regarding withdrawals or surrenders.

Contact Us Today:

Ready to learn more about how Market Value Adjustments (MVAs) may affect your annuity contract? Contact us today to speak with one of our knowledgeable marketers and explore your options.