Anonymous
How can I avoid DBS home loan's compulsory home insurance?
Recently I took up a home loan with DBS, however, there is a home insurance attached to the loan ($50+ annually). I have already purchased my own home insurance and would like to cancel it. It is claimed that it needs to pay $100 as admin fee annually if cancelled. I did not find the amount been put in the loan package and feel it is not necessary.
Called our loan manager, she can help to waive for 1 year admin fee only
Hope can get an answer of how to avoid such a situation. Thanks in advance!
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Pang Zhe Liang
15 Jan 2021
Fee-Based Financial Advisory Manager at Financial Alliance Pte Ltd (IFA Firm)
Read the contract that you have signed carefully. Altogether, it should contain legal information about the home insurance and whether it is really compulsory, and if it entails an admin fee.
If yes, then you will need to negotiate with your loan manager on the next course of action.
If not, then you are not legally required to take on their insurance, nor to pay any admin fee.
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Hi there.
Technically, if you want to avoid the insurance, you have to pay this admin fee.
Since the insurance is cheaper than the admin fee, i suggest that you do not cancel it but have it in the background even as you top up and purchase a better home insurance plan from another provider.
There is no way to avoid this situation, not only DBS but to be fair all banks in Singapore have this same method of earning that little bit more from their clients.