Five Cash-Free Insurance Plans You Can Get in Singapore

This post was originally posted on Planner Bee.

Insurance provides financial security and peace of mind, especially in a country like Singapore, where the cost of living and healthcare is high. However, not everyone can afford insurance due to expensive premiums.

Fortunately, there are five types of insurance in Singapore that you can get without paying cash. The premiums can be deducted from your CPF account, making it easier to stay insured.

In this article, we will look at these insurance options and how they can help protect you and your finances in times of need.

1. CareShield Life

CareShield Life is a long-term care insurance scheme that provides basic financial support if you develop a severe disability and need ongoing personal or medical care, especially in old age.

The policy offers lifetime protection, paying a monthly cash benefit of at least S$600 for as long as you are severely disabled. Severe disability is defined as being unable to perform at least three out of 6 Activities of Daily Living (ADLs), such as eating, bathing, dressing, toileting, transferring, or moving around.

Singaporeans born in 1980 or later are automatically covered under CareShield Life from 1 October 2020 or when they turn 30, whichever is later. Those born in 1979 or earlier can choose to join by applying with their Singpass.

Premiums are fully payable using Central Provident Fund (CPF) MediSave. Family members, such as a spouse, children, parents, siblings, or grandchildren, can also help pay the premiums with their MediSave or by topping up the account with cash.

Pro tip: While CareShield Life provides basic coverage, you can enhance your protection with supplementary plans from private insurers. These plans offer higher payouts and more flexibility in coverage. Find out which CareShield providers offer the best options here.

2. MediShield Life

MediShield Life is a basic health insurance plan run by the CPF Board. It helps cover large hospital bills and selected outpatient treatments, such as dialysis and cancer chemotherapy. The plan follows a co-payment model, reducing the amount you need to pay if you are hospitalised.

All Singapore Citizens and Permanent Residents are covered under MediShield Life, including the elderly and those with pre-existing conditions. Premiums are deducted automatically from your MediSave Account.

No Singapore Resident will lose coverage due to an inability to pay. The Government provides various subsidies and support, including Premium Subsidies for lower- to middle-income groups, Pioneer Generation subsidies, Merdeka Generation subsidies, and MediSave top-ups.

You can also choose to buy an Integrated Shield Plan (IP) from a private insurer for additional coverage. However, most IPs require cash top-ups and may not be affordable for everyone.

Pro tip: As of 1 September 2022, MediShield Life only covers cancer treatments on the approved Cancer Drug List, with set claim limits. This may affect your coverage if your treatment isn’t included. Learn more here: Changes to Medishield Life Coverage for Cancer Treatment and How It Affects Cancer Patients

3. Dependants’ Protection Scheme

Great Eastern Life administers the Dependants’ Protection Scheme (DPS), a term life insurance plan that provides basic financial protection for you and your family in the event of death, terminal illness, or total permanent disability.

Singapore Citizens and Permanent Residents (PRs) aged 21 to 65 are automatically covered under DPS when they make a valid CPF working contribution. Premiums are deducted from your CPF account, with a sum assured of S$70,000 until 59 years old, then S$55,000 from 60 to 64.

Source: Great Eastern Life

DPS is a popular term life insurance plan because of its low annual premium and convenient payment method, especially if you are on a tight budget. If you wish to opt out, you can submit a written request to Great Eastern Life.

Read more: Dependants’ Protection Scheme (DPS): Is It Worth It?

4. CPF Lifelong Income For the Elderly

CPF Lifelong Income For the Elderly (CPF LIFE) is a national annuity scheme that provides monthly payouts for life using your CPF savings. If you have more than S$60,000 in your CPF Retirement Account at age 65, enrolment is mandatory.

There are three plan options: Standard, Basic, and Escalating. The Standard plan offers fixed monthly payouts. The Basic plan starts with lower payouts, which decrease once your CPF balance falls below S$60,000. The Escalating plan starts with lower payouts but increases over time to help offset inflation.

CPF LIFE is a non-profit scheme managed by the CPF Board. Since there are no advertising costs or agent commissions, your savings remain untouched by fees. You will receive the full amount, including risk-free interest of up to 6%, based on the plan you choose.

5. Home Protection Scheme

Protect your house with the Home Protection Scheme (HPS), a mortgage-reducing insurance plan that helps pay off your outstanding HDB loan if you pass away, are diagnosed with a terminal illness, or become permanently disabled. This ensures that you and your loved ones do not risk losing your HDB flat.

HPS is available to CPF members who own an HDB flat and pay their housing instalments using CPF savings or cash. It provides coverage until the loan is fully paid or until the policy holder turns 65. However, it does not cover private properties, such as executive condominiums (ECs).

Premiums for HPS are deducted annually from your CPF Ordinary Account (OA). If your OA balance is insufficient, family members who co-own the flat can use their OA savings to cover the shortfall.

Read more: All You Need To Know About Home Protection Scheme

In addition to these five insurance policies you can get without cash, you can explore other supplementary policies for added coverage. To learn more, feel free to contact Team Planner Bee at [email protected] today!