SINGAPORE - More than half a million members of the Central Provident Fund (CPF) will pay less for their annual home protection insurance from July.
About 510,000 CPF members covered by the Home Protection Scheme (HPS) will enjoy the reduction, because of "better than expected investment returns and claims experience", CPF said in a press statement on Tuesday (June 26).
The scheme protects CPF members and their families from the risk of losing their Housing Board flats in the event of death, terminal illness or total permanent disability before their housing loans are paid up.
"CPF members have to be insured under HPS if they are using CPF savings to pay for the monthly housing loan instalments of their HDB flats," CPF said in the statement.
Those not using their CPF savings to pay their housing loans can also apply for the insurance on their own.
The last time such a reduction was made was in 2012. This round of reduction will benefit 95 per cent of HPS members, of which three-quarters of them will get reductions of at least 10 per cent.
Reviews of the premiums are conducted periodically to ensure that they remain affordable, while maintaining the long-term sustainability of the HPS fund, said CPF.
The new HPS rates will kick in on July 1. Those who join the scheme on that date or after that will enjoy the rates, while existing members will pay the lower prices when they renew or adjust their coverage.
For example, a male HPS member aged 32 who is servicing a $200,000 housing loan from HDB for 30 years will pay a reduced annual premium of $183.20 instead of $215 - equivalent to a 15 per cent reduction - when he joins the scheme from July 1 this year, said CPF.
Potential home buyers can use the HPS calculator on the CPF website to estimate their premiums. More information can be found via the CPF Call Centre on 1800-227-1188, or e-mail email@example.com