AMP. and Endowment. Whole of Life. Investment Statement

Transcription

1 AMP Whole of Life and Endowment Investment Statement

2 AMP Whole of Life and Endowment Investment Statement For the purposes of the Securities Act Prepared as at 10 September 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? 2 Who is involved in providing it for me? 4 How much do I pay? 5 What are the charges? 6 What returns will I get? 7 What are my risks? 9 Can the investment be altered? 10 How do I cash in my investment? 11 Who do I contact with enquiries about my investment? 12 Is there anyone to whom I can complain if I have problems with the investment? 12 What other information can I obtain about this investment? 12

3 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. Choosing an investment adviser You have the right to request from any investment adviser a written disclosure statement stating his or her experience and qualifications to give advice. That document will tell you: whether the adviser gives advice only about particular types of investments, and whether the advice is limited to the investments offered by one or more particular financial organisations, and whether the adviser will receive a commission or other benefit from advising you. You are strongly encouraged to request that statement. An investment adviser commits an offence if he or she does not provide you with a written disclosure statement within 5 working days of your request. You must make the request at the time the advice is given or within one month of receiving the advice. In addition if an investment adviser has any conviction for dishonesty or has been adjudged bankrupt, he or she must tell you this in writing; and if an investment adviser receives any money or assets on your behalf, he or she must tell you in writing the methods employed for this purpose. Tell the adviser what the purpose of your investment is. This is important because different investments are suitable for different purposes. 1

4 What sort of investment is this? Note: Most of the information in this Investment Statement is expressed in terms of taking out a Policy 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 are, in general, based on contingencies on the life of the other person. 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 Building, Level 3, Customhouse Quay, PO Box 1290, Wellington). In this Investment Statement Policy means, as appropriate, either 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. Whole of Life Insurance Policy and Adult Endowment Insurance Policy A Whole of Life Insurance Policy is a life insurance policy under which the premium you pay exceeds the cost of your life cover and, therefore, builds a cash value. An Adult Endowment Insurance Policy is a savings plan with financial protection against death or terminal illness. You choose the maturity date (which must be at least 10 years after taking out the Policy and before you reach 75). 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 accumulated bonuses and any increases under optional extra cover (including inflation indexation), reduced by any prior payment of Terminal Illness Cover, and from which we will deduct any amounts owing against the Policy. Terminal illness If you become terminally ill and are 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. We will pay any remaining life cover on death or maturity. 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 Insurance Policy If you want to tailor your Policy more closely to your particular situation, you can choose extra cover from the following options. You pay a small additional premium for each option you include. Extra cover with an option to convert that cover into other insurance We will pay an extra benefit if you die while this cover applies. You also have the option up to your 50th birthday or earlier maturity date of the Policy to convert this extra cover into other forms of insurance regardless of your health or occupation at the time. Protecting your future insurability You can ensure that at certain times prior to age 40 you can take out an additional Whole of Life Insurance Policy or Endowment Insurance Policy regardless of your health or occupation at the time. Accidental death We will pay an extra benefit equal to the basic sum insured if you suffer accidental death while this cover applies. 2

5 Disablement cover We will pay an extra benefit if you suffer disablement while this cover applies. The amount of benefit will depend on whether you suffer total disablement or 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 You may temporarily increase the amount of life cover you have, for example, during a period of higher financial commitments. Accidental death and disablement We will pay an extra benefit if you suffer accidental death or disablement before the Policy anniversary on or immediately before your 65th birthday. Protection for your Policy If you become totally disabled it may be hard to keep up with your premiums. You can purchase cover to pay your premiums during a period of total disablement, so that you retain the full protection of your Policy. Inflation indexation You authorise us to increase your premiums broadly in line with inflation and to increase your cover using the premium rates applying at the time. 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 age of 21 or maturity of the Policy. When the Policy matures the child can either: take the proceeds (sum insured and bonuses); take the proceeds and exercise the right to take a Whole of Life Insurance Policy or Adult Endowment Insurance Policy (or such other insurance as we determine) to a predetermined level of life cover without evidence of health; or roll the proceeds into a Whole of Life Insurance Policy with a predetermined level of life cover without evidence of health while maintaining the same premium. The risks covered with a Children s Endowment Policy are: Death Full life cover (sum insured plus 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 11% per annum). Terminal illness If the child is over 10 years of age, we will pre-pay up to 100% of the amount payable on death (including bonuses, and after deducting Policy debts, but not including any other benefits attached to the Policy) subject to, among other things, a maximum of $1 million payable over all AMP policies. Optional extra cover for Children s Endowment Policy You pay a small extra premium for each option included. Protect 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. 3

6 Protect your child s Policy In certain circumstances, this option gives your child the full benefit of the Policy if you die or become totally disabled, as we will waive the premiums. Inflation indexation 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. Pure Endowment Policy A Pure Endowment Policy is a savings plan under which you receive the sum insured plus bonuses 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. Who is involved in providing it for me? The issuer of the policies is AMP Life Limited, Customhouse Quay, PO Box 1290, Wellington. In this Investment Statement we or us means AMP Life Limited. The promoter of the policies is AMP Services (NZ) Limited. Under section 2 of the Securities Act 1978 the directors of AMP Services (NZ) Limited are also classified as promoters. They comprise John Alexander Drabble, Quentin MacKinder Wilson, Peter Larsen, Pieter Jonathon Campbell Lindhout and Stuart Gordon Harry Low, all of Wellington. The address of AMP Services (NZ) Limited, and the address at which the directors may be contacted, is AMP Building, Customhouse Quay, Wellington. AMP Life is a modern, broad-based financial services organisation committed to offering customers quality advice, real choice, superior service and outstanding performance. AMP Limited, the ultimate holding company of AMP Life, has more than seven million customers worldwide. (AMP Limited does not guarantee the policies.) AMP Life provides 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. The AMP Group operates in Australia, New Zealand, the United Kingdom and Indonesia. Various arms of AMP Limited (AMP Financial Services and AMP Henderson Global Investors) are each run globally, with AMP Limited holding overall ownership and control. In New Zealand, the AMP Society had been operating since Following restructuring, AMP Life has been operating since 1 January The following products and services are available through AMP Life: Insurance Life Insurance Whole of Life Endowment Term Life Insurance Home Loan Cover Replacement Income Insurance/Renewable Business Expense Insurance Survival Insurance Insurance Bonds Annuities 4

7 Mission and vision In New Zealand, AMP Life s mission is to partner people to build and protect their wealth and enjoy the life they want. In New Zealand, AMP Life s vision is to be the customers window to the financial world. 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. Adult Policies have a minimum sum insured of $5,000. The minimum premiums are: Adult Children Yearly $500 $300 Half yearly $260 $155 Monthly or Four-weekly $45 $30 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 1290, Wellington. You can pay your premiums: yearly or half yearly, by cheque or direct debit; or monthly by direct debit. We add a small 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 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 have the 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. If premiums are collected and paid through a Group Insurance Policy, you may pay the yearly premiums in equal instalments in accordance with the Policy. You must pay the unpaid balance of the yearly premiums immediately we pay a claim, the Policy is cancelled or if you do not pay an instalment before the next instalment is due. 5

8 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 above 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 AMP Adviser or an AMP Customer Service Officer; 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 (NZ) Limited, 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, 5% for quarterly payments, 7.5% for monthly, four weekly, semi-monthly or fortnightly payments, and 8% for weekly payments) and is added to your premiums. The amount of such charges may be altered from time to time. Please note that, for new Policies issued from the date of this Investment Statement, 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. Charges when you change the maturity date of your Policy or convert 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. 6

9 Charges when you convert 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 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 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 discussed 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 is fixed by us. As at the date of this Investment Statement, the interest rate is 9.5%, and is subject to change from time to time depending on market conditions. Payments to AMP Services (NZ) Limited and AMP Henderson Global Investors (New Zealand) 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 Henderson Global Investors (New Zealand) Limited in respect of charges in so far as charges relate to investment management expenses and costs. These companies may in turn make payments to other companies in the AMP Group. 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 (currently 11% per annum). For Pure Endowment Policies, your returns are the sum insured and bonus additions 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. 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 bonuses accruing to your Policy (discussed below) and the time of death. In addition, loans and other debts will be taken into account. 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) 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. 7

10 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, and part is returned to shareholders. Bonus rates are declared on 1 May each year and reflect the performance of the fund over the previous 12 months from 1 January to 31 December, and projected future payments. 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 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 payment of a terminal bonus is not assured. However, Pure Endowment Policies: do not attract terminal bonuses; and do not pay annual bonuses unless you survive until the maturity date. Altering or cashing in your Policy The returns from altering or cashing in your Policy are discussed 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 and realised capital gain 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. There is a six month qualifying period before you can make a claim under Disablement Cover or Premium Payment Cover for total disablement and a 12 month qualifying period before you can claim under Accidental Death and Disablement Cover for total and permanent disablement. We may be able to withhold benefits until you pay any stamp duty or similar 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, or 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. 8

11 What are my risks? A principal risk of not recovering in full the money you pay or not receiving the returns described under What returns will I get? when you are otherwise eligible is that we refuse to pay a benefit or reduce the amount of benefit payable (as the case may be) because: payment of a prior claim to you reduces the amount of benefit payable; your premiums are overdue or you have loans or other amounts borrowed against your Policy; subject to law we amend your Policy as we consider fair because of any incorrect statement about your age in any document; subject to law, there has been a non-disclosure or mis-statement (as these terms are defined in the Policy Document); you cause your own death or intentionally self-inflict illness or injury (within certain time limits); exclusions to the relevant cover apply; you do not pay the stamp duty or similar tax payable on any benefit under the Policy. It is reasonably foreseeable that, on termination of your Policy for non-payment of premiums, mis-statement or disclosure, or causing your own death within certain time limits, 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 which we are required by law to deduct. The other principal 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) is that 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?.) 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 Law (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 industry compensation) - provided such debts or claims are liabilities that are referable to the business of the Statutory Fund No.1. 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. 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 and New Zealand tax) and claims of other creditors would rank ahead of or equally with the claims of Policyholders. 9

12 Can the investment be altered? At any stage, your Policy is designed to adapt to your particular circumstances. You choose the original term and amount you wish to save, 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 either Children s Endowment Policies or 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 two 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 two 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? ). 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 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 as discussed under What are the charges?. 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 before your 70th birthday, at least 5 years after the conversion 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. Bonus additions will be altered and expected future expenses taken into account, when calculating the terms of the altered Policy as discussed under What are the charges?. There is no extra charge for changing the maturity date of an Adult Endowment Insurance Policy. 10

13 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 passes to 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 before your 70th birthday, at least 5 years after the conversion and at least 10 years after the starting date or any increase to the Whole of Life Insurance Policy. You can either: maintain the same premium and adjust the sum insured; or maintain the sum insured and increase your premiums. See further details above under What are the charges?. 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 two 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 less 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 two 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. 11

14 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 pecuniary interest in it. Although no charges are payable to us for the transfer, gift duty may be payable. Who do I contact with enquiries about my investment? For further information and friendly professional advice call your local AMP Adviser or contact an AMP Customer Service Officer at AMP Customer Services, AMP Building, Level 3, Customhouse Quay, PO Box 1290, Wellington. Phone AMP Life toll free on any time between 8am and 8pm, Monday to Friday (except for public holidays). Is there anyone to whom I can complain if I have problems with the investment? In addition to the people referred to under Who do I contact with enquiries about my investment? complaints about the Policy can be made either to your AMP Adviser, or contact AMP Customer Services, AMP Building, Level 3, Customhouse Quay, PO Box 1290, Wellington, or to the Insurance and Savings Ombudsman (if this type of complaint is within the Ombudsman s jurisdiction), BDO House, Customhouse Quay, PO Box , Wellington. Phone (04) 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 the Policy, AMP Life and the Statutory Fund No.1 is contained or referred to in the registered prospectus and in the financial statements of or relating to the Fund, the AMP Society before 1 January 1998 and AMP Life from 1 January (Information about the AMP Society and the Fund before 1 January 1998 relates to the situation before demutualisation and therefore is not necessarily comparable with the current situation.) 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 life insurance 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; a comparison of actual results against any prospectus financial information in an advertisement for your Policy; the latest annual fund report giving information on the general investment climate and the performance of the fund from which your returns are paid. To request any of these documents, or to enquire further about the financial statements, please contact an AMP Adviser, your local AMP office or AMP Customer Services, AMP Building, Level 3, Customhouse Quay, PO Box 1290, Wellington. You can also call us toll free on

15 The prospectus, certain financial statements, sample policy documents and other documents of or relating to AMP Life are filed on a public register at the Companies Office of the Ministry of Economic Development, District Courts Building, 3 Kingston Street, Auckland, and are available for public inspection. We will send you an annual statement and bonus certificate on the anniversary of your Policy. The statement summarises the transactions for the preceding 12 months and states the current amount of life cover under the Policy at that date. 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, Customhouse Quay, PO Box 1290, Wellington, 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. 13

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