Premiums for home protection insurance reduced by 10% for CPF holders

MORE than 540,000 Central Provident Fund (CPF) members paying home protection scheme (HPS) premiums annually will enjoy an average reduction of 10 per cent on their premiums from July 1, 2021.

This comes after better-than-expected investment returns and claims experience, said the CPF board in a statement on Thursday. The last premium reduction was in 2018.

A male member aged 36 with a S$200,000 housing loan from HDB for 30 years, for example, will pay a revised premium of S$209.40 instead of S$232.40 when he joins the HPS from July 1.

Existing members will enjoy the reduced rates when they pay their annual premium or adjust their HPS coverage on or after July 1. They will be notified of their new premium in the month that it is deducted, and can log in to the CPF website to check.

Every year, around 1,000 HDB home owners using their CPF savings to pay for monthly mortgage instalments either pass away, or suffer terminal illness or total permanent disability, said the CPF board.

To avoid a situation where these individuals and their families lose their homes due to the inability to afford the monthly mortgage, HPS protects them by paying up the outstanding loan.

In 2020, home owners insured under HPS made S$83.8 million in claims.

CPF members who are using their CPF savings to pay for the monthly housing loan instalments of their HDB flats have to be insured under HPS. Those who do not use their CPF savings to service their HDB housing loans can apply to be insured under HPS.