Hi, This question asks: 'Suggest possible reasons why the payout from a with profits policy might be different from the policy’s asset share.' In the examiner's report it says that MVAs are not applicable here. Why is this? I understand that MVAs apply only on accumulating with-profits contracts but the question doesn't state whether the policy is accumulating or not, just that its with profits. Thanks
Hi Sinead Good question! I think the answer to this is that an MVA wouldn’t be a reason to explain why a with-profits payout might be different from the policy's asset share (as applying an MVA will bring payout closer to asset share). I don’t think that the examiners are saying that an MVA couldn’t actually be applied to the WP policy. Hope this clears it up Thanks Lynn
