What is Dependants’ Protection Scheme (DPS)?
DPS is an opt-out term insurance scheme which is automatically extended to eligible CPF members. It covers:
1) Sum Assured: $46,000 + $5,000
2) up to 60 years old
3) for Death, Terminal Illness (TI) or Total Permanent Disability (TPD)
Source and more details can be found here:
https://www.cpf.gov.sg/Members/Schemes/schemes/other-matters/dependants-protection-scheme#Item1570
DPS Premium:
| Age (Last Birthday) | Yearly Premium |
| <= 34 years | $36 |
| 35 - 39 years | $48 |
| 40 - 44 years | $84 |
| 45 - 49 years | $144 |
| 50 - 54 years | $228 |
| 55 - 59 years | $260 |
From 40 to 59 years, the total premium you will need to pay is $3,580
($84x5 + $144x5 + $228x5 + $260x5).
If we go to CompareFirst (appreciate Government initiative), I search for similar product as DPS:
Search under "Term Life Products" with the following options:
- Date of Birth: 1 Jan 1976 (for 20yrs calculation)
- Smoker: No
- Premium Type: Annual
- Coverage Term: 16 to 20
- Sum Assured: $50,000
- Critical Illness Benefit: No
- Sort Results by: Premium (Lowest - Highest)
You will get the results from Great Eastern Life as the cheapest at $76 & $91 for female and male respectively (as of 26June2016).
Note: Reducing Sum Assured if different from DPS as the sum assured reduces over time.
So for 20 years, you will pay $1,520 (female) & $1,820 (male) only to cover:
1) Sum Assured: $50,000
2) up to 60 years old
3) for Death, Terminal Illness (TI) or Total Permanent Disability (TPD)
It's a savings of $2,060 (58%) for female and $1,760 (49%) for male.
The only caveat is that you need to use Cash instead of CPF monies to purchase the Term Insurance. Having say it, your $76 (~$6/mth) cash will not have much financial impact on your monthly expenses. To add, keeping your CPF monies, will give you a minimum of 2.5% interest.
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