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How your choices influence the cost of your insurance

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

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

1. Personal risk factors

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

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

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

 

2. The type of insurance you choose

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

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

 

3. Your premium structure

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

Variable age-stepped premiums (formerly stepped premiums)

One way is to have your premiums stepped: in other words, reflecting your age and any risk factors that go every year at the anniversary of your insurance policy.

If you choose variable age-stepped premiums:

  • Your premiums may be less expensive when your policy starts, compared to other options.
  • The cost of your premiums will generally increase each year.
  • Resolution Life can increase your premium if it re-prices the insurance product to ensure it can meet future claims from customers. You will be advised of this if it applies to your policy.

Important information

Where the information on this website is factual information only, it does not contain any financial product advice or make any recommendations about a financial product or service being right for you. Any advice is provided by Resolution Life Australasia Limited ABN 84 079 300 379, AFSL No. 233671 (Resolution Life), is general advice and does not take into account your objectives, financial situation or needs. Before acting on this advice, you should consider the appropriateness of the advice having regard to your objectives, financial situation and needs, as well as the product disclosure statement and policy document for the product. Any guarantee offered in the product is only provided by Resolution Life. Any Target Market Determinations for our products can be found at resolutionlife.com.au/target-market-determinations. 

Resolution Life does not make any representation or warranty as to the accuracy, reliability or completeness of material on this website nor accepts any liability or responsibility for any acts or decisions based on such information.

Resolution Life can be contacted at resolutionlife.com.au/contact-us or by calling 133 731.