Market Value Adjustment (MVA) During a guarantee period of more than one year, which is called a Guaranteed Rate Option (GRO), an MVA applies to annuity options and withdrawals in excess of the free withdrawal amount. The MVA reflects the effect of the change in the interest rates we offer between the time the GRO was selected and the time the MVA is applied. Generally, if interest rates increase, the MVA reduces your contract’s value. On the other hand, if interest rates decrease, the MVA increases your contract’s value. The MVA will not result in a value of less than the contribution applied at the beginning of the current GRO, minus withdrawals taken during the current GRO (including any withdrawal charge, but not considering any MVA), plus interest credited at the guaranteed minimum interest rate. Withdrawal charges may reduce this amount. An MVA does not apply during the last 30 days of the GRO or to the death benefit. How the MVA Works The MVA is calculated by multiplying the MVA factor. 10 Here is how MVA works with a surrender: The owner places $10,000 in the 5-year GRO at 2.00% (plus a 1.00% first-year-only interest rate enhancement). Three years later the contract is surrendered. The MVA is calculated using the currently offered 2-year interest rate for comparison because two years remain in the GRO period: 1. If the 2-year rate is 1.00%, it would produce a positive MVA equal to $152.70, which would be added to the account value of $10,716.12. The result: a total market-value-adjusted account value of $10,868.82. The account value after the MVA then would be reduced by the applicable withdrawal charge, if any, to produce the surrender value. 2. If the 2-year rate is 3.00%, it would produce a negative MVA equal to ($254.51), which would be subtracted from the account value of $10,716.12. The result: a total market-value-adjusted account value of $10,461.61. The account value after the MVA then would be reduced by the applicable withdrawal charge, if any, to produce the surrender value.
Product is issued by Integrity Life Insurance Company, Cincinnati, OH, or National Integrity Life Insurance Company, Greenwich, NY. Integrity Life operates in DC and all states except NY, where National Integrity Life operates. W&S Financial Group Distributors, Inc., Cincinnati, OH (doing business as W&S Financial Insurance Services in CA) is an affiliated agency of the issuer. Issuer has sole financial responsibility for its products. All companies are members of Western & Southern Financial Group. Payment of benefits under the annuity contract is the obligation of, and is guaranteed by, the insurance company issuing the annuity. Guarantees are based on the claims-paying ability of the insurer. Products are backed by the full financial strength of Integrity Life or National Integrity Life. Earnings and pre-tax payments are subject to income tax at withdrawal. Withdrawals of taxable amounts from an annuity are subject to ordinary income tax, and, if taken prior to age 59½, may be subject to a 10% IRS penalty. Withdrawals may be subject to charges. An MVA applies to early transfers, withdrawals and annuitizations, if applicable. Neither Western & Southern member companies, nor their agents, offer tax advice. Interest rates are declared by the insurance company at annual effective rates, taking into account daily compounding of interest. Product and feature availability, as well as benefit provisions, vary by state. See your financial professional for product details and limitations. Single Premium Deferred Annuity Contract with Market Value Adjustment Feature and Interest Rate Enhancement series ICC17 INT-16 1701, NIL-16 1701 NY R1, Waiver of Withdrawal Charge and Market Value Adjustment (MVA) Rider series ICC11 IR.36 1112 and ICC11 NR.36 1112 and NR.36 1112 NY. No bank guarantee • Not a deposit • May lose value • Not FDIC/NCUA insured • Not insured by any federal government agency © 2011-2022 Western & Southern Financial Group. All rights reserved. 10 MVA Factor = 0.95 x [A-(B+0.0025)] x N/12; where: A = base interest rate for your current GRO; B = base interest rate offered for a duration of N for this annuity on the date the MVA is applied plus .0025 (factor used to compensate the insurer for the cost of processing the withdrawal, including the transaction costs of liquidating any assets); N = number of whole months remaining in your current GRO (if N < 12 months, B = base interest rate for the 1-year guarantee period).
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