Singaporeans who use their CPF savings to repay their mortgage loans from HDB will soon enjoy savings when paying their insurance premiums under the Home Protection Scheme.
The Central Provident Fund (CPF) board announced on Tuesday (26 June) that Singaporeans who use their CPF savings to repay their mortgage loans from HDB will enjoy savings when paying their insurance premiums under the Home Protection Scheme (HPS) starting next month.
HPS is a mortgage-reducing insurance that protects CPF members and their families against losing their HDB flats in the event of death, terminal illness or total permanent disability before their housing loans are paid up. This insures their property until they reach the age of 65 or until the housing loan is fully repaid, whichever is earlier.
CPF members need to be insured under this scheme if they are using their CPF savings to service their monthly mortgage instalments. Those who tap other sources of funds for their HDB housing loans may also voluntarily apply to be insured through this scheme.
Three in four CPF members could see their premiums slashed by at least 10 percent, although the premium amount varies depending on the loan amount, tenure and category (concessionary or market rate) as well as the mortgagor’s age and gender.
For instance, the CPF board noted that a 32-year-old man who took out a $200,000 mortgage with a tenure of 30 years from HDB will see a 15 percent reduction in his HPS premiums as he only needs to pay $183.20 instead of $215 per annum.
CPF members who have enrolled under the HPS scheme on or after 1 July will be eligible for the lower premiums, while existing policy holders are required to renew or adjust their HPS coverage beginning on that day.
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