CPF members to get higher sum assured, increased coverage for DPS

Singapore

FROM next April, Central Provident Fund (CPF) members aged below 55 under the Dependants' Protection Scheme (DPS) will pay lower premiums in return for a higher sum assured.

For most age groups the sum assured will be raised to S$70,000, up from S$46,000 currently, the CPF Board announced on Friday.

The maximum age of coverage will also be increased from the current cap of 60 to cover members up to age 65, though the sum assured for this older age group will be lower at S$55,000.

DPS is a term-life insurance scheme that pays out upon death, terminal illness or total permanent disability. According to the CPF Board, there were 1.9 million members with existing DPS cover as at end-2019.

Peh Er Yan, CPF Board's group director of housing and investment, said: "DPS is meant to protect the member and his dependants during his working years. The higher sum assured of S$70,000, which is approximately three years of salary for a lower-income member, will provide greater financial support for the insured members and their family members in the event of a claim."

On average, there will be a premium reduction of about 47 per cent per thousand-dollar sum assured.

On why the sum assured for older members is lower, the CPF Board said these members are likely to have accumulated sufficient CPF or other forms of savings. They are also more likely to have fewer dependants reliant on their income, with children who have reached adulthood.

Separately, CPF Board awarded Great Eastern Life a five-year contract to administer the DPS starting from April 1, 2021.

Members insured under NTUC Income will be moved to Great Eastern Life when the latter takes over the sole administration of the DPS. Those insured under NTUC Income will need to make a new DPS nomination.

Meanwhile, members aged 60 and above but below 65 years who wish to rejoin DPS can do so by applying directly with Great Eastern when the new contract comes into effect, the CPF Board added