Above all, most of us will have the basic term insurance policy, Dependants’ Protection Scheme (“DPS”). This is for the purpose of protecting your dependants and yourself during your working years.

Do You know?

When Dependants’ Protection Scheme was first introduced in May 1989, CPF Board administers this scheme. Afterwards in September 2005, this insurance scheme became privatised.

Since then, there were various amendments to improve its scope of coverage. In like manner, the next enhancement took place on 1st April 2021.

Table of Contents:

1. Sole Insurer
2. Coverage Period
3. Coverage Amount
4. Premium for Dependants’ Protection Scheme
5. Insurance Nomination
6. Claim
7. Final Thoughts on Dependants’ Protection Scheme

One Minute Summary:

• Great Eastern Life will become the sole administer for Dependants’ Protection Scheme.
• There is no changes to the scope of coverage, i.e. Death, and Total Permanent Disability.
• The coverage period will extend to those between 16 years old and below 65 years old.
• In sum, you will get higher coverage (up to S$70,000) at a lower cost (up to 50% cheaper).
• If your policy was with NTUC Income previously, then you will need to submit a new insurance nomination form.

Part 1: Sole Insurer

Firstly, Great Eastern Life will become the sole administer for Dependants’ Protection Scheme from April 2021 onwards.

Part 1.1: What if my policy was with NTUC Income previously?

In this situation, your policy will be transferred to Great Eastern Life from April 2021 onwards. This is because Great Eastern Life has became the sole administer for DPS. Therefore, all policyholders at NTUC Income will port over to Great Eastern Life automatically. For this purpose, you may login to CPF website to check and confirm this change.

1. Login to my CPF Online Services.
2. From the left navigation menu, click “My Messages”.
3. Under the Insurance section, you may click on the link to see your DPS insurer.

Part 2: Coverage Period

All in all, Dependants’ Protection Scheme will cover you for a longer period.

Part 2.1: Application

Previously, all Singaporeans and Permanent Residents between age 16 and below age 60 may apply for DPS. Following the change in April 2021, those between 16 years old and below 65 years old may apply for this coverage.

Part 2.2: Automatic Enrolment

By and large, Dependants’ Protection Scheme will cover you automatically when you fulfil the following three conditions.

1. Singaporean or Permanent Resident;
2. Between 21 and 60 years old;
3. Made your first CPF working contribution.

After the enhancement, the age band extends to those between 21 and below 65 years old.

What if I am between 16 and below 21 years old?

On this occasion, you may approach Great Eastern Life to submit an application directly.

Part 2.3: Automatic Renewal

Before the change, your Dependants’ Protection Scheme policy will renew automatically so long as you are below 60 years old. Great Eastern Life will extend the renewal age to everyone below 65 years old now.

Part 3: Coverage Amount

For the most part, there is no change to the scope of coverage. In other words, Dependants’ Protection Scheme will cover you for

• Death;
• Terminal Illness;
• Total Permanent Disability.

Part 3.1: Higher Sum Assured

Previously, the standard sum assured for Dependants’ Protection Scheme is S$46,000.

Following the change, this is the breakdown for the coverage:

• Between 21 and below 60 years old: Sum assured will become S$70,000;
• Between 60 and before 65 years old: Sum assured will become S$55,000.

Part 3.2: What can you do with the $70,000 payout?

Okay, let’s do a quick analysis at this point. Generally, Life Insurance Association Singapore (LIA) recommends you to have about ten times annual income as basic life cover.

Accordingly, this means that DPS will provide $7,000 for your family for 10 years. To put it another way, that will be about $583 a month.

As you will agree, this amount will probably be sufficient for basic living needs only. In the meantime, your family will need to find an alternative source of income to survive in the long run.

By the way, have you wondered why you need life insurance coverage? Check out the following infographic for some insights to that end.

Part 4: Premium for Dependants’ Protection Scheme

Part 4.1: Cost of Insurance over Time

In sum, the following table gives you a better understanding on the previous and new premium over time.

Overall, I am glad to have higher insurance coverage at a lower cost during my prime years. Given that rising cost of living, it certainly makes more sense to have higher insurance coverage today. What’s more, the lower cost adds the icing on top of the cake!

Part 4.2: How to pay for DPS?

Emphatically, there is no change to the mode of payment for you policy. In detail, this is the order of deduction:

1. Firstly, Great Eastern Life will deduct the premium from your CPF Ordinary Account.
2. In the event that there is insufficient funds, the deduction shall take place from your CPF Special Account.
3. If both attempts fail, then you will have to pay the outstanding premium in cash.

Part 5: Insurance Nomination

For one thing, you will need to pay attention to the insurance nomination. This is particularly important if your previous insurer was NTUC Income.

Part 5.1: Previous Insurer: Great Eastern Life

Generally, there is nothing that you need to do unless you wish to nominate new beneficiaries. Under those circumstances, you may submit a new insurance nomination form to override the existing distribution.

Part 5.2: Previous Insurer: NTUC Income

It is important to realise that you will need to submit a new insurance nomination form to this end. Therefore, be sure to complete it today. Otherwise, the proceeds will follow the Intestate Succession Act and you will have zero control over the distribution to that end!

Part 6: Claim

Since Great Eastern Life is the sole administer from April 2021, you may contact them for claim matters.

Moreover, you may find out more about the various claim situations in my previous post.

Part 7: Final Thoughts for Dependants’ Protection Scheme

As the ‘default’ term insurance policy that we own, we will enjoy higher insurance coverage at a lower cost. What’s more, the interest that you receive from CPF is probably sufficient to pay for this policy throughout its tenure. Therefore, it feels like a classic to keep this insurance policy.

Be that as it may, remember to include it into your insurance portfolio summary as part of your financial planning.

Checklist for Dependants’ Protection Scheme:

1. Are you currently holding onto Dependants’ Protection Scheme?
2. Complete an insurance nomination today.

First Published: 10 November 2020
Last Updated: 7 April 2021