Mutual bonus

We love rewarding our members

Being a mutual

LV= is a mutual insurer which means we're owned by our 1.2m members.

The LV= mutual bonus was introduced in 2011 and rewards eligible members for their continued investment in the Society.

Each year the LV= Board considers whether to declare a mutual bonus and, if so, the level and form of the bonus and which policies should receive it. This takes into account:

the performance of LV=’s trading business (its life insurance business and its holding in a general insurance business);
LV=’s capital position;
smoothing profits and losses; and
the contribution to LV= made by various groups of policies (for example, the risks taken by them in supporting the establishment and growth of LV=’s trading business).

Currently only members with LV= with-profits policies are eligible to receive a mutual bonus but this may not always be the case. RNPFN Fund and Teachers Assurance Fund with-profits policies are not eligible. Most eligible members will receive the mutual bonus when their LV= with-profits policy ends. The LV= mutual bonus is not a guaranteed benefit and is at the sole discretion of the LV= Board. Previously declared mutual bonus can be taken away in exceptional circumstances (for example, if it were required to protect our financial strength), though it may be subsequently reinstated if the Board considers it appropriate.

Answering your questions about our mutual bonus

Mutual bonus frequently asked questions

2018 mutual bonus £26 million

Our performance in 2018 has enabled us to allocate a discretionary mutual bonus of £26 million (2017: £26 million). We have applied the mutual bonus by uplifting the payouts of LV= with-profits policies as follows:

Policy group	Uplift % 2018	Uplift % 2017
Conventional with-profits policies and with-profits annuities	1.0%	1.0%
Accumulating and unitised with-profits policies except Flexible Guarantee policies	1.0%	1.0%
Flexible Guarantee Bonds Series 1 and 2 / Flexi Guarantee Plan / Flexible Guarantee Funds Series 1	0.5%	0.5%
Flexible Guarantee Bonds Series 3 / Flexible Guarantee Funds Series 2	0.2%	0.0%

Policy group	Uplift % 2018	Uplift % 2017
Conventional with-profits policies and with-profits annuities	1.0%	1.0%
Accumulating and unitised with-profits policies except Flexible Guarantee policies	1.0%	1.0%
Flexible Guarantee Bonds Series 1 and 2 / Flexi Guarantee Plan / Flexible Guarantee Funds Series 1	0.5%	0.5%
Flexible Guarantee Bonds Series 3 / Flexible Guarantee Funds Series 2	0.2%	0.0%

A mutual bonus has been declared for the first time for Flexible Guarantee Bonds Series 3 / Flexible Guarantee Funds Series 2. However these policies need to be in-force for at least 12 months before they are eligible for it. For the 2018 mutual bonus these policies would have to have been in-force on 31 March 2018 to receive it.

The different enhancements applied for 2018 reflect the contribution to the Society made by these different groups of policies.

Since the launch of the mutual bonus in 2011, LV= has allocated a total mutual bonus of £182 million to eligible member policies.

Mutual bonus will form part of the amount payable when the policy matures, pays a death claim or is cashed in, except for eligible annuitants which receive an increase in their income. For most with-profits policies it is added by increasing any final bonus or top-up bonus (or reducing any Market Value Reduction) that otherwise would be paid.

The FAQ section includes information regarding how much of the 2018 mutual bonus will be added to your policies and a summary of our mutual bonus declarations to date.