How your choices influence the cost of your insurance

There are a lot of components that go into determining what type of insurance policy you need and how much you’ll pay in premiums to maintain your cover. It can be a highly personalised process, and that can make it tricky to understand why you might be paying a different amount to someone else.

To help you understand what you’re paying and why, we’ve broken it down into three categories: your personal risk factors, the type of insurance you choose and your premium structure.

1. Personal risk factors

During the underwriting process, we assess your history and lifestyle against a range of factors to calculate the possibility that certain life events may happen to you. The higher your level of risk for these factors, the higher your premiums are likely to be.

Here are some of the personal risk factors that can influence your premiums:

  • Age - some illnesses become more likely as you get older.
  • Gender  - each gender has its own risk factors, so men and women generally pay different premiums.
  • Occupation - for example, working in a mine carries more risk than working as a retail assistant.
  • Health factors - a high Body Mass Index (BMI) can be an indicator of poor health.
  • Dangerous hobbies - for example, sewing is less risky than skiing.
  • Smoking - smoking increases your risk of illness and disease.
  • Medical history - hereditary factors, or conditions developed in your lifetime, can increase your risk of becoming ill or injured later in life.
  • Your home state - each state government taxes insurance transactions differently.

2. The type of insurance you choose

Your life insurance policy has been designed with a lot of different features that you can pick and choose from, so it fits your lifestyle and needs. Some of these features may increase the cost of your insurance:

  • Types of cover
  • The amount you’re insured for
  • Premium frequency (i.e. monthly or annually)
  • Waiting period before you can receive any benefits
  • Annual indexation to keep up with inflation

3. Your premium structure

Everyone’s financial situation is different. That’s why AMP Life offers different ways for you to pay your insurance premiums.

Level premiums

With level premiums:

  • Your premiums will stay at the applicable rate based on your age when you took out or added that cover portion to your policy. The premium can be a larger amount due to increases to sum insured, which have the applicable level premium rate applied for your current age when you accept the inflation rate increase or apply for a general increase in level of cover. AMP Life can increase your premium if it re-prices the insurance product to ensure it can meet future claims from customers.
  • If you plan to have your policy for 10 years or more, level premiums may be easier to budget for over the life of your policy, because they’re usually more predictable. But keep in mind that all insurers may make changes to product premiums from time to time to ensure it has the required reserves to meet future claims from customers.


Van and Thi, both aged 40, have two children aged 10 and 12. The couple run a small family business and are paying off a mortgage.

Van and Thi both have Death and TPD cover, which will pay them a lump sum if one of them passes away, becomes terminally ill or becomes permanently disabled. However, they’re concerned that if either of them gets temporarily sick or injured, the other person won’t be able to manage the business alone.

After talking to a financial adviser, they decide to take out Income Protection insurance as well. This will provide them with a monthly payment of up to 75% of their income if they were to become sick or injured.

The couple looked carefully at their premium payment options and decided to pay level premiums. This could make it easier for them to plan their budget. While paying level premiums was initially more expensive than another option, they prefer the peace of mind and not having to pay the high premium rates when they are older.

Warning: This example is illustrative only and is not an estimate of the insured amount you will receive or fees and costs you will incur. This example is based on the following assumptions (a) the cover amount remains the same throughout the period and the policy is not cancelled or suspended and (b) No waiting period applies to the policy.

The AMP Life Insurance Calculator

can provide you with an estimate of how much your insurance will cost if you make changes to your personal risk factors, type of insurance or premium structure.

Find out more

If you have any questions about your insurance, speak to your financial adviser or call AMP Life.

AMP Life

Monday to Friday 8:30am – 7:00pm (AET)

Important information

Products in the AMP Super Fund and the Wealth Personal Superannuation and Pension Fund are issued by N.M. Superannuation Proprietary Limited (N.M. Super) ABN 31 008 428 322 (trustee), which is part of the AMP group (AMP). Before deciding what’s right for you, it’s important to consider your particular circumstances and read the relevant Product Disclosure Statement, Target Market Determination or Terms and Conditions available from AMP at or by calling 131 267. Read AMP’s 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.

Products in the AMP Eligible Rollover Fund, National Mutual Retirement Fund, and NM Pro Super Fund are issued by Equity Trustees Superannuation Limited ABN 50 055 641 757 (trustee). Risk products are issued by AMP Life Limited ABN 84 079 300 379 (AMP Life), which is part of the Resolution Life group. AMP Life has proudly served customers in Australia since 1849. AMP Limited ABN 49 079 354 519 has sold AMP Life to the Resolution Life group whilst retaining a minority economic interest. AMP Limited has no day-to-day involvement in the management of AMP Life whose products and services are not affiliated with or guaranteed by AMP Limited. AMP Limited is not liable for products issued by AMP Life or any statements or representations made in the PDS for those products. “AMP”, “AMP Life” and any other AMP trademarks are used by AMP Life under licence from AMP Limited. Before deciding what’s right for you, it’s important to consider your particular circumstances and read the relevant Product Disclosure Statement, Target Market Determination or Terms and Conditions available from AMP Life at or by calling 133 731. Read AMP Life’s Financial Services Guide for information about our services, including the fees and other benefits that AMP Life and/or other companies within the Resolution Life group may receive in relation to products and services provided to you.

Any advice and information provided is general in nature, hasn’t taken your circumstances into account, and is provided by AWM Services Pty Ltd ABN 15 139 353 496 (AWM Services), which is part of the AMP group (AMP). All information on this website is subject to change without notice.

Life Insurance Code of Practice

The Life Insurance Code of Practice is issued by the Financial Services Council (FSC) and sets out the life insurance industry’s commitment to high customer service standards, consistency and principles of conduct.

As a member of the FSC, AMP supports the Life Insurance Code of Practice. You can find more information here.