Positive news has emerged on the with profits front with MGM Assurance announcing their new rates. The mutual has decided not to follow suit and cut payouts and annual bonuses but to leave unitised with profits bonuses the same, at 3.5% for pensions and 3% for life.
They have also cut their market value reduction penalty to no more than 10% for policies taken out between 1999 and 2000.
Our View
MGM Assurance has obviously had a good year in terms of returns and has decided not to take the cautious route of holding everything back in reserve. This will give confidence to investors who will believe MGM to be acting in their best interests.
MGM's Chief Operating Officer said: "we believe that as a mutual it is appropriate to share the benefits of a good investment year with our members as quickly as it is prudently possible to do so"