Whole of Life and Endowment

Transcription

1 Whole of Life and Endowment INVESTMENT STATEMENT DATED 22 June 2012 WEL279872

2 AMP Whole of Life and Endowment Investment Statement For the purposes of the Securities Act Prepared as at 22 June There is a registered prospectus containing an offer of securities to which this Investment Statement relates. Important information (The information in this section is required under the Securities Act 1978.) Investment decisions are very important. They often have long-term consequences. Read all documents carefully. Ask questions. Seek advice before committing yourself. Choosing an investment When deciding whether to invest, consider carefully the answers to the following questions that can be found on the pages noted below: What sort of investment is this?...1 Who is involved in providing it for me?...4 How much do I pay?...4 What are the charges?...5 What returns will I get?...7 What are my risks?...8 Can the investment be altered?...9 How do I cash in my investment? Who do I contact with inquiries about my investment?...11 Is there anyone to whom I can complain if I have problems with the investment? What other information can I obtain about this investment? In addition to the information in this document, important information can be found in the current registered prospectus for the investment. You are entitled to a copy of that prospectus on request.

3 The Financial Markets Authority regulates conduct in financial markets The Financial Markets Authority regulates conduct in New Zealand s financial markets. The Financial Markets Authority s main objective is to promote and facilitate the development of fair, efficient, and transparent financial markets. For more information about investing, go to Financial advisers can help you make investment decisions Using a financial adviser cannot prevent you from losing money, but it should be able to help you make better investment decisions. Financial advisers are regulated by the Financial Markets Authority to varying levels, depending on the type of adviser and the nature of the services they provide. Some financial advisers are only allowed to provide advice on a limited range of products. When seeking or receiving financial advice, you should check: the type of adviser you are dealing with: the services the adviser can provide you with: the products the adviser can advise you on. A financial adviser who provides you with personalised financial adviser services may be required to give you a disclosure statement covering these and other matters. You should ask your adviser about how he or she is paid and any conflicts of interest he or she may have. Financial advisers must have a complaints process in place and they, or the financial services provider they work for, must belong to a dispute resolution scheme if they provide services to retail clients. So if there is a dispute over an investment, you can ask someone independent to resolve it. Most financial advisers, or the financial services provider they work for, must also be registered on the financial service providers register. You can search for information about registered financial service providers at You can also complain to the Financial Markets Authority if you have concerns about the behaviour of a financial adviser. What sort of investment is this? Note 1 Most of the information in this Investment Statement is expressed in terms of taking out a Policy (see note 3) on your own life. However you can also take out a Policy on the life of another person (such as a spouse). In that case, you will be liable to pay the premiums, but the payment of benefits to you will be, in general, based on contingencies on the life of the other person. Note 2 This section gives a brief description of the investments. Further details, including definitions of important terms, are in the Policy Documents (available on request from AMP Customer Services, AMP Centre, 29 Customs Street West, PO Box 55, Shortland Street, Auckland 1140). In this Investment Statement, the term Policy Document refers to the specimen policy document for the relevant type of Policy, which is available to you on request and is appended to the registered prospectus referred to under What other information can I obtain about this investment? on page 10. You should consult the relevant Policy Document for more details, including the definitions of important terms referred to in this Investment Statement. Note 3 In this Investment Statement Policy means, as appropriate, a standard Whole of Life Insurance Policy, Adult Endowment Insurance Policy, Children s Endowment Policy, or Pure Endowment Policy. We may negotiate special terms and conditions with you. These products are closed to new investors. No new policies will be issued except to existing policyholders who are exercising rights under their existing policies. Prospectus means the prospectus as at the date of this Investment Statement. It is currently the intention that during the life of the Prospectus certain rights within existing policies will be replaced by alternative more contemporary options for policyholders, but it is our intention that policyholders will not be adversely impacted by such actions. 1

4 Whole of Life Insurance Policy and Adult Endowment Insurance Policy A Whole of Life Insurance Policy is foremost a life insurance policy that provides an increasing level of cover for death or terminal illness and gradually builds up a cash value through to the Policy anniversary on or immediately before age 95. An Adult Endowment Insurance Policy is foremost a life insurance policy that provides an increasing level of cover for death or terminal illness and gradually builds up a cash value through to a chosen maturity date (which must be at least 10 years after taking out the Policy and before you reach 75). Whole of Life Insurance Policies are not available to children under 10 years of age. Under a Whole of Life Insurance Policy or Adult Endowment Insurance Policy we pay the amount of your life cover as follows: Death If you die while covered by the Policy we will pay the amount of your Life Cover. Life Cover is the total of the basic sum insured plus (if applicable) any inflation indexation, any bonuses and any increases under optional extra cover, reduced by any prior payment of Terminal Illness Cover and any amounts owing against the Policy such as overdue premiums or loan debt (including interest). Terminal illness If you become terminally ill as defined in the Policy Document (this includes being expected to live for less than 12 months), we will advance you up to 100% of your Life Cover subject to, among other things, a maximum of $1 million over all of your AMP Policies. If your Life Cover exceeds $1 million, we will pay any remaining Life Cover when you die or (if earlier) when your Policy matures. Maturity of your Policy For a Whole of Life Insurance Policy, we will pay the amount of your life cover if you survive until the Policy anniversary on or immediately before your 95th birthday. For an Adult Endowment Insurance Policy, we will pay the amount of your life cover if you survive until the maturity date stated in your Policy. Optional extra cover under a Whole of Life Insurance Policy or Adult Endowment If you want to tailor your Policy more closely to your particular situation, you can choose when taking out your Policy (or subsequently) one of the following options. You will pay a small additional premium for each option you include. Extra cover with an option to convert that cover into other insurance If you choose this option then we will pay an extra benefit if you die while covered by the Policy. You will also have the option, up to your 50th birthday or the earlier maturity date of the Policy, to convert this extra cover into other forms of insurance for you regardless of your health or occupation at the time. Protecting your future insurability If you choose this option then at certain times prior to age 40 (described in the Policy Document) you can take out an additional Whole of Life Insurance Policy or Endowment Insurance Policy on your life regardless of your health or occupation at the time. Accidental death If you choose this option then we will pay an extra benefit equal to the basic sum insured if you suffer accidental death while this cover applies. This cover does not extend to accidents caused by certain events prescribed in the Policy Document. Disablement cover If you choose this option then we will provide an extra benefit if you suffer total disablement or total and permanent disablement (in each case as defined, and subject to the exceptions noted, in the Policy Document) while this cover applies. The nature of the benefit will depend on whether you suffer total disablement or total and permanent disablement: for total disablement, AMP Life will pay any premiums falling due while you are totally disabled (with the exceptions noted in the Policy Document); and for total and permanent disablement, AMP Life will pay an additional amount equal to your Life Cover on the date of total and permanent disablement. Disablement must result from illness, accident or injury and begin before the Policy anniversary on or immediately before your 65th birthday. (When we pay a benefit for total and permanent disablement, no further benefit is payable and the Policy ends.) Extra temporary life insurance If you choose this option then you may temporarily i.e. for a specified term - increase the amount of Life Cover you have (for example, during a period of higher financial commitments). 2

5 Accidental death and disablement If you choose this option then subject to the exceptions noted in the Policy Document, we will pay an extra benefit if you suffer accidental death, permanent total disablement or permanent partial disablement (in each case as defined in the Policy Document) before the Policy anniversary on or immediately before your 65th birthday. Protecting your Policy If you become totally disabled it may be hard to keep up with your premiums. If you choose this option then you can purchase cover to pay your premiums during a period of total disablement as defined for this purpose in the Policy Document, so that you retain the full protection of your Policy. Your total disablement must begin before the policy anniversary on or immediately before your 60th birthday (and other conditions apply). Inflation indexation If you choose this option then you authorise us to increase your premiums broadly in line with inflation and correspondingly, to increase your cover (using the premium rates applying at the time). Conditions apply and these are set out in the Policy Document. Children s Endowment Policy A Children s Endowment Policy works in most respects like the Adult Endowment Insurance Policy. The life insured is that of a child. Only a parent or legal guardian or a court approved person may take out a Children s Endowment Policy, which can be taken out while the child is aged between 1 day and 10 years. Ownership of the Children s Endowment Policy passes from the parent or guardian to the child at the earlier of the Policy anniversary on or immediately before the child reaches age 21 or the maturity date of the Policy. When the Policy matures the child can simply take the proceeds (sum insured and bonuses) or, within 2 months following the maturity date and without health evidence: in addition to taking the maturity proceeds, exercise the right to take out a Whole of Life Insurance Policy or Adult Endowment Insurance Policy (or other such insurance as we determine) for a sum insured of up to five times the maturity value; or roll the maturity proceeds into a Whole of Life Insurance Policy for a sum insured of up to six times the maturity proceeds (while maintaining the same premium). The risks covered with a Children s Endowment Policy are: Death Full Life Cover (basic sum insured, plus if applicable any inflation indexation and any bonuses, reduced by any policy debts and any prior payment of Terminal Illness Cover) will apply from age 10. Under New Zealand law, there is a restriction on what we can pay on the death of children under 10 years. If the child dies before their 10th birthday, we will refund all premiums paid to date plus compound interest at a statutory rate of interest (currently at 5% per annum). Terminal illness If the child is over 10 years of age and becomes terminally ill as defined in the Policy Document (for a child, this includes being expected to live for less than six months), we will prepay up to 80% of the Life Cover subject to, among other things, a maximum of $500,000 per person insured, payable over all AMP policies. Optional extra cover for Children s Endowment Policy You pay a small extra premium for each option included. Protecting your child s future insurability This option gives your child the right to gain increased life cover under a Whole of Life Insurance Policy or Adult Endowment Insurance Policy (or such other insurance as we determine) from ages 10 to 30 (provided the maturity date has not occurred) or during the two months after the maturity date, regardless of their health at the time. Protect your child s Policy This option gives your child the full benefit of the Policy if you die or become totally disabled (as defined for this purpose in the Policy Document) as we will waive the premiums. Your total disablement must begin before the policy anniversary on or immediately before your 60th birthday (and other conditions apply). Inflation indexation If you choose this option then you authorise us to increase the premiums broadly in line with inflation and to increase the cover using the premium rates applying at the time. Conditions apply and are set out in the Policy Document. Pure Endowment Policy A Pure Endowment Policy is a savings plan under which you receive the sum insured plus accumulated bonuses (if applicable) if you survive until the maturity date. If you die before the maturity date, you receive the greater of: an amount equal to the premiums paid with 6% compounded interest; or an amount equal to the cash value (if any) of the Policy, as determined by AMP Life. 3

6 Who is involved in providing it for me? The issuer of the policies is AMP Life Limited, AMP Centre, Level 21, 29 Customs Street West, Auckland In this Investment Statement, we, us, our or AMP Life means AMP Life Limited. As at the date of this Investment Statement, the directors of AMP Life are: Catherine Michelle Brenner, Centennial Park, Australia Anthony Maxwell Coleman, Northbridge, Australia Craig William Dunn, St Ives, Australia Craig Duncan Meller, Mosman, Australia John Leonard Palmer, Nelson, New Zealand Peter Roger Shergold, O Malley, Australia. The principal promoter of the policies is AMP Services (NZ) Limited ( AMP Services ), which is also responsible for managing the sales and distribution of the Policies, administering policyholder records and providing policyholder services in accordance with the terms of each Policy. The directors of AMP Services are also classified as promoters of the Policies. As at the date of this Investment Statement, AMP Services directors are Anthony George Regan, Thérèse Mary Singleton and James Gladstone Georgeson, all of Auckland. The address of AMP Services, and the address at which the directors may be contacted, is AMP Centre, Level 21, 29 Customs Street West, PO Box 55, Auckland The directors of AMP Life and/or AMP Services and their addresses may change. Details of the current directors of either company and their addresses may be obtained on the Companies Office website The directors of AMP Life may be contacted at AMP Centre, Level 21, 29 Customs Street West, Auckland AMP Life is a leading provider of wealth management and wealth protection products and services in Australia and New Zealand. Through AMP Financial Services, AMP Life has strong market share positions in a range of superannuation, risk insurance and traditional life insurance products in Australia and New Zealand. Through AMP Capital Investors (New Zealand) Limited, AMP is one of the largest investment managers in Australia and New Zealand. The principal activities of AMP Life are providing life and disability insurance, personal financial services and advice. The AMP Society was established in 1849 in Sydney, Australia, the location of the group head office. On 1 January 1998 the AMP Society, as a result of restructuring, became AMP Life. In New Zealand, the AMP Society had been operating since Following restructuring, AMP Life has been operating since 1 January Pursuant to an agreement that came into effect on 30 March 2011 between AXA Asia Pacific Holdings Limited, AXA S.A. and AMP Limited (the ultimate parent company of AMP Life), AMP Limited also became the ultimate parent company of The National Mutual Life Association of Australasia Limited (NMLA). AMP Limited is currently working on integrating AMP Life and NMLA. The following insurance products are available in New Zealand through AMP Life: Life Insurance Whole of Life Endowment Lifetrack (Term Insurance) Lump Sum Regular Income How much do I pay? Setting premiums You can tell us the amount you wish to insure your life for and we ll work out the premiums. Or, tell us how much you want your premiums to be, and we ll tell you the amount this will initially insure your life for. As at the date of this Investment Statement, adult Policies have a minimum sum insured of $5,000. The minimum premiums as at the date of this Investment Statement are: We calculate premiums based on the initial amount you are insuring your life for, any optional extra cover, and factors such as your age, health, sex and occupation, as well as assumptions on investment returns, mortality rates and expenses. Your premiums may increase if you select the inflation indexation option, add other optional extra cover or increase the sum insured after the commencement of your Policy. Under a Whole of Life Insurance Policy, your premiums cease when you reach age 85. This means your Policy will continue to provide the full benefits from age 85 through to maturity at the Policy anniversary on or immediately before your 95th birthday without any further premium payment. Payment of premiums Money payable under any Policy is payable to us at AMP Customer Services, PO Box 55, Shortland Street, Auckland You can pay your premiums: yearly or half yearly, by cheque or direct debit; or monthly by direct debit. ADULT CHILDREN Yearly $500 $300 Half yearly $260 $155 Monthly $45 $30 We will add an extra charge if you choose any option other than a single annual payment. You are not obliged to pay premiums. However, if you do not pay, your Policy will be adversely affected. If payment of your premium is more than one month late and: the Policy has been kept in force for two years from the commencement date; and the cash value (if any) of the Policy, as fixed by us, after deduction of any amounts owing to us, is at least equal to the premium due; then we will take enough from the cash value to cover the outstanding premium which will then be considered paid. Any sum taken in this way will bear compound interest (as set by us) and, together with interest, will be a first charge on the Policy and may be paid to us at any time. Subject to the above we will not pay a benefit and we may exercise a right to cancel the Policy if any premium is outstanding more than one month after it became due. We will then keep any money already paid to us. 4

7 We may agree to reinstate a Policy within 2 years of cancellation due to unpaid premiums subject to certain conditions. In all cases the premiums for the period between the date of cancellation and the date of reinstatement must be paid before cover can recommence. 14 day free look period You can cancel a Policy and receive a full refund of any money you have paid to us by returning the Policy Document to us within 14 days of receiving it, together with a written instruction to cancel the Policy. What are the charges? You pay a premium You pay a premium for your Policy. The basis of calculation of your premium, and the minimum premiums, are set out under How much do I pay? Part of your premiums provide for the cost of your life cover. Also, part of your premiums go to cover various expenses and costs incurred by AMP Life, other AMP companies or AMP Life s Statutory Fund No.1, namely: AMP Advisers receive initial and regular commission payments for each Policy they sell. The basis for this commission may change from time to time. At the date of this Investment Statement, such commission is based on the amount of the premium and the expected term of the Policy. If you would like further details please ask your adviser or an AMP Customer Service Consultant; Various overheads and administration costs are incurred in selling, establishing and maintaining your Policy. Many of these costs are in the form of payments to AMP Services, which provides us with various services. Also, in setting bonus rates we take into account costs as described above and the costs of maintaining capital reserves (as well as other factors). Expenses and costs will vary from time to time. Payment method charge Your premium will include a charge for your payment method if you pay your premium other than by a single annual amount paid in advance. This charge is a percentage of the premium amount for a single annual payment (3% for half yearly payments and 7.5% for monthly payments) and is added to your premiums. The amount of such charges may be altered from time to time. Your options for paying your premiums are yearly, half-yearly or monthly and the stated payment method charge will apply if you choose to pay half-yearly or monthly. The amount of such charges may be altered from time to time. Early termination charges The method used to determine the payment made to you on early termination of your Policy is determined by us and is subject to review. The method used takes into account various factors including your age, sex, basic sum insured, bonuses (which will be reduced), the term to maturity, the premiums paid, the cost of life insurance, and an allowance for investment expenses and administration costs. When you take out a Policy (and at any time in the future) you may obtain illustrations of early termination payments that would apply under the termination basis currently in force. Changing the maturity date of your Policy or converting a Whole of Life Insurance Policy to an Adult Endowment Policy If you change the maturity date of a Children s Endowment Policy or an Adult Endowment Policy, or convert a Whole of Life Insurance Policy to an Adult Endowment Insurance Policy, we will alter bonus additions to allow for the altered terms of the Policy when we calculate the new premium or sum insured. We will also take into account expected future expenses when calculating terms of the altered or converted Policy. There will be no charge for the change itself. Converting your Policy to a fully paid up Policy The method used to determine the value of your Policy if you stop paying premiums and your Policy becomes fully paid up is determined by us and is subject to review. The method takes into account various factors including your age, sex, basic sum insured, the term to maturity, the premiums paid, the cost of life insurance, any premium or loan debts on the policy, and an allowance for investment expenses and administration costs. There is no charge for the change itself. When you take out a Policy (and at any time in the future) you may obtain illustrations of values of paid up Policies that would apply under the basis for calculation currently in force. Interest charged on overdue premiums or loans If payment of your premiums is more than one month late, in some circumstances we may take the amount of the outstanding premium from the cash value of your Policy and we will charge you compound interest on the amount of the overdue premium. Also, if you take out a loan against your Policy (as described under Can the investment be altered? ), we will charge you interest and other expenses related to the loan. In both these cases, the interest rate will be fixed by us from time to time. Any alteration to the rate of interest will have effect from a date decided by AMP Life. Except as required by law, AMP Life is not required to give any notice of changes to interest rates. As at the date of this Investment Statement, the compound interest rate charged for overdue premiums, and for loans on policies, is 6% but, as noted above, this is subject to change. Because your policy contains this facility it is a consumer credit contract and is governed by the Credit Contracts and Consumer Finance Act This document sets out the key information about this component of your policy and is an initial disclosure statement for the purposes of the Credit Contracts and Consumer Finance Act Statements in this document are made as at the date you take out your policy. Creditor s details Any advances made to you will be made by AMP Life Limited, AMP Centre, Level 21, 29 Customs Street West, Auckland Advances The initial unpaid balance of this facility is zero. No advances are made unless we treat as paid an unpaid premium (where the premium remains unpaid after 30 days) or you take a loan against your policy. After 30 days, overdue premiums are deducted from the gross surrender value of your policy. 5

8 Credit limit The credit limit for this facility is 90% of the current cash value of your policy. We will treat an unpaid premium as paid or allow the drawdown of a loan only if your policy has sufficient cash value to offset the amount due, after taking into account existing advances and interest. If the total amount you owe exceeds 100% of the gross surrender value of your policy, we will cancel your policy. Interest The current annual interest rate for this facility is 6%. We will advise you if this rate changes in the future. Interest is calculated daily on any advances made and unpaid interest is added to the balance of your loan (i.e. capitalised) once per year. The date that interest is capitalised will be shown on the relevant Monthly Loan Statement. If you would like to know the date interest would be capitalised for your policy, please contact our Customer Service Centre on Credit fees and charges We do not currently charge any fees for this facility. Payments required You are not required to repay advances made to you (although we encourage you to make regular repayments), and this information assumes you will not make any repayments. If you have not repaid advances made to you when you become entitled to a benefit under the policy, the amount you owe will be deducted from the gross maturity value of the policy (sum insured plus existing annual bonus less terminal bonus (if applicable)). You can choose to make repayments, and may wish to do so to ensure that the value of your policy is preserved. You can make one-off repayments or organise regular monthly repayments from your bank account. Please contact our Customer Service Centre on if you would like to arrange this. We do not charge fees for early repayment. If you want to repay advances made in full, all you need to pay is the outstanding balance plus any unpaid interest. Right to cancel Because your policy is a consumer credit contract you have a right to cancel it for a short time after you take it out. More information about this right is set out below. Security Repayment of advances made (including interest) is secured against the value of your policy. Continuing disclosure statements We will post Monthly loan statements if advances are made to you while those advances are outstanding. Statement of right to cancel The Credit Contracts and Consumer Finance Act 2003 gives you a right for a short time after the terms of this contract have been disclosed to you to cancel the contract. How to cancel If you want to cancel this contract you must give written notice to the creditor. You must also return to the creditor any advance and any other property received by you under the contract. Time limits for cancellation If the disclosure documents are handed to you directly you must give notice that you intend to cancel within 3 working days after you receive the documents. If the disclosure documents are sent to you by electronic means (for example, ) you must give notice that you intend to cancel within 5 working days after the electronic communication is sent. If the documents are mailed to you, you must give the notice within 7 working days after they were posted. Saturdays, Sundays, and national public holidays are not counted as working days. What you may have to pay if you cancel If you cancel the contract, the creditor can charge you - a) the amount of any reasonable expenses the creditor had to pay in connection with the contract and its cancellation (including legal fees and fees for credit reports, etc); and b) interest for the period from the day you received the advance until the day you repay the advance. This statement only contains a summary of your rights and obligations in connection with the right to cancel. If there is anything about your rights or obligations under the Credit Contracts and Consumer Finance Act 2003 that you do not understand, if there is a dispute about your rights, or if you think that the creditor in being unreasonable in any way, you should seek legal advice immediately. Payments to AMP Services (NZ) Limited and AMP Capital Investors Limited We make payments to AMP Services (NZ) Limited, which provides us with various services, in respect of all of the charges set out in this section except in so far as the charges relate to investment management expenses and costs. We make payments to AMP Capital Investors Limited (an Australian company) in respect of charges in so far as the charges relate to investment management expenses and costs. These companies may in turn make payments to other companies in the AMP Group. Consent to electronic communications We are happy to receive questions and communications concerning your policy and this facility electronically. Our address is service@amp.co.nz 6

9 What returns will I get? General Your returns consist of benefits payable under the Policy: For Whole of Life Insurance Policies, Adult Endowment Insurance Policies and Children s Endowment Policies, returns are the life cover (and/or terminal illness cover), including any optional extra cover and bonuses (where applicable). However, for Children s Endowment Policies, if the child dies before their 10th birthday, we are restricted by law and will pay the premiums paid to date plus compound interest at a statutory rate of interest (at the date of this Investment Statement, 5% per annum). If the child dies before age 16, we are restricted by law to paying the life cover to a limited class of persons, including the parents or guardians of the child. For Pure Endowment Policies, your returns are the sum insured and accumulated bonus additions (if applicable) if you survive to the maturity date (together with any additional benefits) or, if you die before the maturity date, an amount equal to the greater of premiums paid with 6% compound interest or the cash value (if any) of the Policy as determined by AMP Life. The key factors determining the returns are the amount for which you are insured, whether the circumstances under which any optional extra cover is payable have occurred, the amount of any bonuses accruing to your Policy (discussed below) and the time of death. In addition, loans and other debts will be taken into account, as well as the consequences of early termination of your policy or conversion to a fully paid up policy (see What are the charges? ). We do not promise any amount of returns quantifiable as at the date of this Investment Statement and enforceable by you, as the returns depend, among other things, on the sum insured and options you choose and in some circumstances might not be payable (e.g. if you cause your own death within a certain period, as described in each Policy Document) or may be varied. (See What are my risks? and Can the investment be altered?.) The dates on which returns will be due and paid are unknown at the time you take out the Policy as they depend on, among other things, whether you survive until, or die prior to, the maturity date. Bonuses Your Policy is a participating Policy and as such it shares in the surplus of AMP Life s Statutory Fund No.1 (or other AMP Life Statutory Fund of which the Policy for the time being forms part). The available surplus varies from year to year, depending on factors such as economic conditions, investment performance, expenses, claims experience, any future changes in legislation, and the need to maintain a sufficient level of reserves. Part of this surplus is returned to policyholders in the form of bonuses each year (except that a Pure Endowment policy does not pay an annual bonus unless the policyholder survives until the Policy matures), and part is returned to shareholders. Bonus rates reflect the previous performance of the Fund and projected future payments and receipts. We do not promise any amount of bonuses. There are two types of bonuses: Annual bonuses are added to the sum insured on your Policy anniversary each year (though, if your Policy is a Pure Endowment Policy, only if you survive until the Policy matures) and are permanent additions to your Policy. They are also compounding: those already added also attract bonuses in the future. They are payable in full with your sum insured on the maturity date of your Policy or in the event of your death. A reduced value will apply if you cash in your Policy prior to maturity or death; Terminal bonuses are calculated as a percentage of annual bonuses and are only added to the value of the Policy (provided the Policy has been in place for at least five years) when it matures, or becomes a claim by death. The actual amount and payment of a terminal bonus is not assured and the amount can change at any time without notice. This will affect the surrender (cash) value of your Policy as well as the benefit payable when you die (or when the Policy matures). Altering or cashing in your Policy The returns from altering or cashing in your Policy are described under Can the investment be altered? and How do I cash in my investment?. What is the tax position? Taxes, duties, reserves and retentions are some of the factors affecting your returns (e.g. in calculating bonuses and on alteration or termination of your Policy). Under the current law you will have no personal income tax to pay on any return under your Policy, as we pay the tax (out of the Statutory Fund No.1) on all investment income so that any amount paid to you will be tax paid (except in some business situations). We may withhold returns for a period in some circumstances Before we accept liability for a claim and make any benefit payment, we must receive your Policy Document and proper proof, satisfactory to us, of your age and identity and the event or continuation of the circumstances giving rise to the claim. There are some additional requirements for payments of benefits for various types of cover under the Policies, as described in the Policy Documents. There is a 6-month qualifying period before you can make a claim for total disablement under the disablement cover or the premium payment cover described on pages 2 and 3 of this Investment Statement, and a 12-month qualifying period before you can claim under disablement cover for accidental death & disablement. We may be able to withhold benefits until you pay any applicable tax payable on a benefit. Legal liability to pay the returns The legal liability to pay returns is that of AMP Life, although this liability is restricted to the assets of AMP Life s Statutory Fund No.1 (which is described in the registered prospectus for the Policies), or any other AMP Life Statutory Fund of which your Policy for the time being forms part when you make a claim. AMP Limited does not guarantee the Policies. 7

10 What are my risks? General All investments carry risk. There are a number of risks associated with the Policies that could impact on your ability to recover in full the money that you pay, or could result in your not receiving the returns described under What returns will I get?. These risks include, without limitation, our refusing to pay a benefit or reducing the amount of benefit payable (as the case may be) because: your premiums are overdue (see Payment of premiums on page 4) or you have loans or other amounts borrowed against your Policy; or subject to law, we amend your Policy as we consider fair because of any incorrect statement about your age in any proposal form, health questionnaire or other document; or subject to law, there has been a non-disclosure or misstatement (as defined below) in which case no benefit payments will be made under the policy, we may cancel the policy and we will keep any premiums paid; or you cause your own death or intentionally self-inflict illness or injury (within certain time limits set out in the Policy Document); or exclusions to the relevant cover apply (as set out in the Policy Document). In general, in each Policy Document: a non-disclosure means your failure to disclose a matter that we should have been told about, and which is material to our risk; and a mis-statement means any statement from you in a proposal form, health questionnaire or other document (on the basis of which we have granted or re-instated insurance under your Policy) that was either: a) fraudulently made, and substantially incorrect in any detail material to our risk; or b) substantially incorrect in any detail material to our risk, and made within 3 years before your death or (if earlier) the date on which we decline to pay a claim under your Policy. It is reasonably foreseeable that, on termination of your Policy for non-payment of premiums, mis-statement or non-disclosure, or causing your own death within the time limits set out in the Policy Document, you will have received in total less than the amount you paid us. We will deduct from benefit payments the amount of any taxes, duties or other charges that we are required by law to deduct. A risk of not recovering in full the money you pay or not receiving the returns described above under What returns will I get? (other than the cash value) will also arise if you cash in your Policy before the maturity date. It is reasonably foreseeable that if you cash in your Policy you will receive in total less than the amount you paid, especially if you do so in the early years of the Policy. You cannot be required to contribute more than the amounts described previously under How much do I pay? without your agreement, unless we amend the Policy as a result of incorrect statements about your age. (See Can the investment be altered?.) We elaborate on certain specific risks below. Investment risks Payments under the bonuses facility described on page 6 of this Investment Statement are determined primarily by reference to the investment performance of the Main Fund comprised within AMP s Statutory Fund No.1 (which is the fund from which we satisfy our obligations to policyholders with respect to the Policies to which this Investment Statement relates). That Fund s assets comprise shares, property, fixed interest, cash and other securities, and these bear investment risks (meaning the risk of negative or lower than expected returns). Each investment sector in which the Main Fund is invested has risks typical of that sector, such as: for shares, the risk of specific events impacting on the performance of the relevant company and its shares, including the liquidity of those shares; for property, liquidity risks and the risk of declines in property values; for fixed interest, the risk of changes to interest rates in the market affecting the investments value, and of borrowers not making interest payments and/or not repaying loans; for cash deposits with a bank, the small risk of the bank defaulting (meaning that some or all of the cash may be lost); and for international investments, the risk of currency movements affecting their value. More generally, economic, political, market, regulatory, environmental and technological conditions in New Zealand and internationally will impact on share prices, property values and interest rates. In particular, the low interest rates being experienced globally as at the date of this Investment Statement have affected, and may continue to affect, the performance of the Main Fund. However, and it is important to note that events affecting investments cannot always be foreseen. The assets of the Main Fund will accordingly rise and fall in value, and the Fund s returns may from time to time be negative (however returns to policyholders are smoothed with the aim of providing a stable return over time). It is for these reasons (among others) that AMP Life may revise bonus rates from time to time, and the addition of future bonuses is not guaranteed (although once added, annual bonuses are permanent additions). Changes to tax legislation As at the date of this Investment Statement, returns under the Policies are tax paid, with all investment income tax being paid from AMP Life s Statutory Fund No.1 under the life insurance tax provisions in the Income Tax Act 2007 before policyholders receive benefits from their Policies. Changes in tax rates and tax rules in New Zealand, and in the countries in which investments are made by AMP Life, may affect the returns from your Policy. Relationship property sharing We must comply with the provisions of any Court order, or resulting arrangement, under the Property (Relationships) Act 1976 requiring us to vest your Policy wholly or partly in your spouse or partner (or to direct a benefit payment from your Policy to your spouse or partner) following a relationship property settlement. 8

11 Bankruptcy If you become bankrupt then your entitlements under your Policy will pass to and vest in the Official Assignee in Bankruptcy. This means there is a risk that, on bankruptcy, your entitlements under the Policy could be claimed by your creditors. Insolvency of AMP Life As a policyholder, you are not liable to pay money to any person as a result of our insolvency. If we are put into liquidation or wound up under Australian law, some debts and claims will rank ahead of claims of policyholders to the assets of our Statutory Fund No.1, pursuant to section 187(1) of the Life Insurance Act 1995 (Australia) and section 556(1) of the Corporations Act 2001 (Australia). These include liabilities that are incurred by specified persons (such as the liquidator), various winding up expenses, and various payments to and for employees (including wages, superannuation contributions and injury compensation) - provided such debts or claims are liabilities that are referable to the business of the Statutory Fund No.1. Claims of any policyholder will rank equally with claims of all other policyholders. If steps were taken to wind up AMP Life in Australia, it is likely that our assets in New Zealand would be dealt with in that winding up, and would be applied by the Australian liquidator in accordance with Australian law. While an application to liquidate our assets in New Zealand might be made to a New Zealand Court, it is not likely that a New Zealand Court would grant such an order. If a New Zealand Court did grant such an order, however, it is unclear to what extent preferential claims under New Zealand legislation (e.g. costs of liquidating the New Zealand assets, amounts due to employees and New Zealand tax) and claims of other creditors would rank ahead of or equally with the claims of policyholders. In that case there is a strong possibility that under New Zealand law our liabilities in respect of statutorily preferred New Zealand and Australian claims, and the claims of our preferred creditors, would rank ahead of our liabilities to policyholders for payment out of our Statutory Fund No.1. For more details including the restrictions which the Life Insurance Act 1995 (Australia) places (for policyholder protection purposes) on how the assets of a Statutory Fund may be used, you should refer to the registered prospectus for the Policies (see What other information can I obtain about this investment? on page 10) or contact us at the address shown on page 10. Regulatory risk AMP Life was granted a provisional licence under the Insurance (Prudential Supervision) Act 2010 on 27 February 2012 and we are currently working towards gaining a full licence under that Act by 30 September If we do not meet the conditions of our provisional licence or fail to be granted a full licence by the Reserve Bank of New Zealand for any reason whatsoever, we will be required to cease carrying on an insurance business in New Zealand and other penalties may apply. Financial Strength Rating Risk Our financial strength rating under the Insurance (Prudential Supervision) Act 2010 is AA-. There is a risk that this rating could change. Any downgrade could affect the success of AMP Life s business. A copy of the legislation (and a copy of any other NZ statute referred to in this Investment Statement) can be viewed at Can the investment be altered? At any stage, your Policy is designed to enable you to adapt to your particular circumstances. You choose the original term and amount you wish to contribute, and you can also change your mind along the way. Alterations will be subject to various conditions (e.g. evidence of health). Your premiums may increase in some circumstances Your premiums are fixed for the duration of your Policy. They do not change unless: you choose to increase premiums each year in line with inflation to help protect the value of your Policy against increases in the cost of living. (This option does not apply to Pure Endowment Policies); you choose to change the amount for which your life is insured or to add or remove optional extra cover; or we amend the Policy as we consider fair because of any incorrect statement about your age made to us in any document. Increasing your premiums provides an even larger capital sum at maturity while obtaining a higher level of life cover to match. These increases can be made up to 10 years before your maturity date, subject to your continued good health and satisfactory assessment by us. (You may only increase a Children s Endowment Policy before the child s 10th birthday.) If you increase your premium, the increased premium becomes the new premium rate for your Policy. Although you are not obliged to continue to pay increased premiums, your Policy will be adversely affected if you do not (as described under How much do I pay? ). You can stop paying premiums If you inform us that you cannot continue to pay premiums for whatever reason, your Policy can still remain in place to the end of its term as a fully paid up Policy. Your Policy will continue to build up bonuses on a reduced level of life cover, based on the capital you have already accumulated in your Policy. Your Policy must have been in place for at least 2 years before this option can be considered, otherwise we may cancel the Policy. You can apply to borrow against your Policy If you need cash urgently but don t want to lose the insurance protection already in place, you can apply to borrow against the cash value of your Policy (after the first 2 years premiums have been paid) without disrupting your existing cover. Eligibility for a loan will depend on our criteria at the time. You will be subject to charges payable on loans, as referred to above under What are the charges? ). 9

12 You can change the maturity date on Children s Endowment Policies You have the option to alter the maturity date (within certain limits) after the Policy anniversary on or immediately before the child s 18th birthday. We will then determine any adjustments to the sum insured, bonuses or premiums payable. Bonus additions will be altered, and expected future expenses taken into account, when calculating the terms of the altered Policy. You can change the maturity date on Adult Endowment Policies You can change the maturity date of an Adult Endowment Policy. The new maturity date must be a Policy anniversary at least 5 years after the change and at least 10 years after the starting date or any increase to the Policy. Bonus additions will be altered to allow for the altered terms of the Policy. You can either: maintain the same premium and adjust the sum insured; or maintain the sum insured and adjust your premiums. You can cash in your Policy or Plan See How do I cash in my investment? below. You can change the owners of the Policy Your policy can be issued to more than one owner, as joint tenants. This means that in the event of the death of one owner, ownership of the policy continues with the surviving owner or owners. You can convert a Whole of Life Insurance Policy to an Adult Endowment Insurance Policy You can convert a Whole of Life Insurance Policy to an Adult Endowment Insurance Policy payable on a maturity date you choose or earlier death. The nominated maturity date must be a Policy anniversary which precedes your 70th birthday, is at least 5 years after the conversion and at least 10 years after the starting date or the date of any increase to the Whole of Life Insurance Policy. You can either: maintain the same premium and reduce the sum insured; or maintain the sum insured and increase your premiums. Charges may change If your Policy is altered, the charges set out under What are the charges? may alter accordingly. How do I cash in my investment? You can cash in your Policy in part or in full Your Policy does not have a cash value until 2 years premiums have become due and been paid. Thereafter you can cash in your bonuses or your Policy in part or in full. However, the amount you receive from cashing in your Policy will be determined by us and will take into account certain costs such as administration expenses, and loans and other debts, so you will receive less than the face value of your bonuses and your cover will reduce (or cease if you cash in your Policy in full). See What are the charges?. For a number of years the cash value (including the value of annual bonuses) may be less than the premiums paid. The cash value will eventually exceed the premiums paid in most cases. Alternatively, you may wish to consider applying to borrow against the cash value of your Policy (after the first 2 years premiums have been paid). This does not disrupt your existing cover. Eligibility for a loan will depend on the criteria at the time. You will be subject to charges payable on loans. You may cancel your Policy Your 14 day free look period is explained above under How much do I pay? If you cancel your Policy at any other time, you are not entitled to get any premiums back, other than those you have prepaid for any period ahead of the date of cancellation. If the Policy has a cash value, we will return the cash value to you as explained above. We may cancel your Policy in some circumstances We may cancel a Policy if: you do not pay the premium within one month of the due date, or within any other time specified in your Policy Document (and we cannot take an amount from the cash value of the Policy to cover the premium as explained under How much do I pay? ); or there has been a mis-statement or non-disclosure. In such circumstances we may keep any money you have paid to us. You may sell your Policy While we are firmly committed to the ultimate benefits of Policies being available to meet the needs of the original policyholders, we accept that in some situations a policyholder will wish to sell his or her Policy. You may sell your interest in your Policy to another person. There is a secondary insurance market for insurance policies. Once you sell your Policy, you will no longer have any interest in it. No charges are payable to us for the transfer. 10

13 Who do I contact with inquiries about my investment? If you have any inquiries, call AMP Customer Services on freephone , 8am 6pm, Monday to Friday or write to the Administration Manager, AMP Services (NZ) Limited, 29 Customs Street West, PO Box 55, Shortland Street, Auckland Recording of telephone calls AMP may monitor and record telephone calls to Customer Services for the following purposes: maintaining accurate records of AMP s dealings with you; monitoring the level of service being provided by AMP; investigating complaints and resolving disputes between you and AMP; auditing, compliance and reporting; and training and development. Is there anyone to whom I can complain if I have problems with the investment? If you have a complaint, call AMP Customer Services on freephone , 8am 6pm, Monday to Friday or write to the Customer Response Manager, AMP Services (NZ) Limited, 29 Customs Street West, PO Box 55, Shortland Street, Auckland AMP Life, AMP Services, and their nominated representatives are all participants of an independent dispute resolution scheme operated by the Insurance and Savings Ombudsman ( the ISO ). If you have complained to any of us and you have reached the end of our internal complaints process without your complaint being resolved to your satisfaction, the ISO may be able to consider your complaint. For the ISO to consider your complaint we must have deadlocked your complaint and other criteria must be met. You may contact the ISO by phoning , faxing (04) , ing iombudsman@clear.net.nz, or writing to: Office of the Insurance and Savings Ombudsman Level 11, Classic House Murphy Street, PO Box Wellington 6143 What other information can I obtain about this investment? A copy of your Policy Document and proposal will provide further information about your Policy. Further information about your Policy, AMP Life and the Statutory Fund No.1 ( the Fund ) referred to under What are my risks? is contained or referred to in the registered prospectus and in the financial statements of or relating to the Fund and AMP Life and you may request from us free of charge a copy of all or any of: the most recent financial statements of or relating to the Fund registered under the Financial Reporting Act 1993; the most recent financial statements of or relating to AMP Life registered under the Financial Reporting Act 1993, together with all documents registered with those financial statements; the prospectus relating to the issue of your Policy, or the most recent prospectus relating to life insurance policies of the kind you hold, together with copies of any documents registered under the Securities Act 1978 for the purpose of extending the period during which allotments may be made under the relevant prospectus; the most recent investment statement relating to life insurance policies of the kind you hold; and a comparison of actual results against any prospective financial information in an advertisement for your Policy. To request any of these documents, or to inquire further about the financial statements, please contact your adviser, or AMP Customer Services, 29 Customs Street West, PO Box 55, Shortland Street, Auckland You can also call us toll free on The prospectus, certain financial statements, sample policy documents and other documents of or relating to AMP Life are available for inspection on a public register at the Registrar of Financial Service Providers, and may be available for public inspection (upon payment of any prescribed fee) on the Companies Office website, or by telephoning the Ministry of Economic Development Business Service Centre on We will send you an annual statement and bonus certificate on each anniversary of your Policy. The statement will state the current amount of Life Cover under the Policy at that date. Information about the ISO scheme is available on the ISO s website There is no cost for using the ISO s services. 11

14 The information you provide is covered by the Privacy Act Your rights in relation to personal information are governed by the Privacy Act You will be asked to provide personal information: when you seek a quotation from us for a Policy; when you take out a Policy; periodically thereafter (so we are aware of any relevant changes in your circumstances); and in the event of certain circumstances, under the terms and conditions of your Policy. We use this information to process the application, and to administer your Policy. It may also be used to offer you other financial services available from the AMP Group. The information is collected and held by AMP Life Limited, Level 21, 29 Customs Street West, Auckland, the intended recipient of the information. If you do not provide all the information your proposal may be declined and we may not be able to provide some benefits or services to you. In some circumstances, we may be able to vary benefits (as explained in Can the investment be altered? ). You are entitled to ask to see, during normal working hours, any of your personal information we hold. If you believe that this information is incorrect, you may ask us to correct it. If for any reason we are unable to do so, we will attach to your information details of your request. Policy Document governs each Policy The descriptions in this Investment Statement are based on the Policy Documents, but are not the Policy Documents themselves. The Policy Document for each Policy, and the terms of your particular Policy, will contain other provisions to which you are subject and those will prevail over the descriptions in this Investment Statement. If you require any further information then you should consult the Policy Document (and, if applicable, your Policy). 12

15 Notes

16 For more information talk to your Adviser today. You can also contact us by: phone web WEL /12