Sunday, 25 December 2011

CPF lowers rates for Home Protection Scheme premium

By Jessica Cheam, The Straits Times, 20 Dec 2011

Come the new year, owners of Housing Board flats who are paying premiums for their Home Protection Scheme (HPS) using their Central Provident Fund (CPF) will get to enjoy savings of 12 per cent on average.

The CPF Board said on Tuesday that as of Jan 1, about 362,500 CPF members will enjoy this discount. This makes up about 80 per cent of its members who are paying premiums for this scheme.

The other 20 per cent are not eligible as they are already paying low premium rates, said CPF.

The scheme is compulsory for anyone using CPF savings to service a loan for a Housing Board flat. It pays off a home loan should the member die or become permanently incapacitated.

With the reduction, for example, a male member, 36, who is servicing a $150,000 housing loan from the Housing Board for 25 years, will pay a lower annual premium of $195.30 instead of $223.05, when he joins the scheme from Jan 1, 2012.

Home buyers using their CPF to pay for the scheme on or after Jan 1, 2012 will enjoy the new rates, while existing members paying annual HPS premiums will pay the lower premiums when they renew or adjust their HPS coverage on or after Jan 1, 2012.

CPF said those who are eligible for lower premium rates will be notified via letters upon successful payment of their next premium due on or after Jan 1, 2012.

The last revision to HPS rates was done in 2006.


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