At the banking royal commission, AMP has admitted that it continues to deduct life insurance premiums from deceased customers' superannuation.

The embattled financial services giant was hauled back before the inquiry, which earlier this year claimed the scalps of former chief executive Craig Meller, chairman Catherine Brenner, a slew of board directors and its chief legal counsel.

On Monday, AMP customer and wealth executive Paul Sainsbury faced questions about insurance provided to its superannuation fund members.

The inquiry heard that AMP continues to deduct insurance premiums, even after being notified of a member's death.

"These were premiums for life insurance?" asked counsel assisting the inquiry Mark Costello.

"Where there was no longer a life to insure?"

"That's right," said Mr Sainsbury.

Despite internal concerns and customer complaints since at least 2016, AMP continued to deduct premiums from some superannuation accounts after being notified of the customer's death, with the intention of refunding them when the death benefit is paid out.

Under questioning by commissioner Kenneth Hayne, Mr Sainsbury admitted the refunds do not include the extra money that would have been earned if the premiums had not continued to be taken out of the superannuation accounts.

Hayne: So the time value of money goes to AMP's benefit?

Sainsbury: Potentially.

Hayne: Charging premiums for life insurance to someone who is dead, that's the position, isn't it?

Sainsbury: Yes, that's the way the system is treating it today for a portion of our business.

AMP launched an investigation in April, after the practice of charging dead customers came under the royal commission's microscope.

One Commonwealth Bank customer was charged for financial advice for more than a decade after their death.

AMP found cases where premiums were incorrectly refunded or not refunded at all.

To date, AMP has identified 4,645 dead customers, who are owed $1.3 million in unrefunded premiums and lost earnings.

"[The investigation is] still ongoing, but it does appear as though there are other fee types that have been deducted post the date of death that will need to be refunded as well," said Mr Sainsbury.

AMP notified ASIC of a breach regarding the incorrect refunds but not for the actual practice of continuing to charge the premiums after death.