8 life insurance terms that should be on your radar

By understanding these terms you can cut through some of the confusion.

Underwriting, exclusion, indexation…these are just some of the terms that may be used when explaining the ins and outs of an insurance policy.

We explain the meanings of these and some other common life insurance terminology to help put you on the front foot when it comes to understanding your insurance.


This is the amount of money charged by your insurer for your insurance cover.


You may choose to have your amount of cover ‘indexed’ so that your level of cover automatically rises each year to help protect against increases in the cost of living. This will mean your premiums will also increase accordingly.


Underwriting is the process used by the insurer to assess your application for insurance. Your insurer will determine the cost of the cover for you in line with the risks faced by you, including your age, sex, health and lifestyle factors. This may mean being asked to provide extra information about your health or undertake a medical assessment.

Duty of disclosure

This is your legal obligation to be honest about your age, health and lifestyle when applying for insurance. It enables the insurer to decide whether to insure you, and on what terms, including the premium for you. Your duty of disclosure applies from the time you submit an application, and continues until your policy is in place. So if something changes after you submit your application, you still need to notify the insurer.

Pre-existing condition

A pre-existing condition is a medical condition, injury, or sickness that you knew about, or were being treated for, before your insurance commences.


An exclusion is a circumstance that will not be covered under your insurance policy. For example, you won’t be covered for injury resulting from war, a criminal act, or a pre-existing condition.


This is the person (or people) who receive your benefit payment in the event of your death. Some insurance policies allow you to nominate your beneficiaries.


A claim is the formal notification you or your representative gives to the insurer to apply for a payment under the terms of your policy.

Want more information?

Insurance can be complex, but it’s a vital element in protecting your financial future. To learn more speak to your financial adviser, or if you need help finding one call us on 131 267 or use our find an adviser tool.

Want to keep up to date with the latest news?

Sign up now.

Sign up now

How much insurance do you need?

There are many factors that come into consideration. Our calculator can help you work out what type and how much cover you may require.

Find out now

Want to keep up to date with the latest news?

Sign up now.

Sign up now

Recommended articles

Important information

Show more

© AMP Life Limited. It’s important to consider your particular circumstances and read the relevant Product Disclosure Statement before deciding what’s right for you. This information hasn’t taken your circumstances into account.

This information is provided by AMP Life Limited. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relation to products and services provided to you. All information on this website is subject to change without notice.

Although the information in this article is from sources considered reliable, AMP does not guarantee that it is accurate or complete. You should not rely upon it and should seek qualified advice before making any investment decisions. Except where liability under any statute cannot be excluded, AMP does not accept any liability (whether under contract, tort or otherwise) for any resulting loss or damage of the reader or any other person.