Asked 3w ago
He talked to me about mortgage insurance. I knew of the compulsory need to purchase the HPS using CPF. But he informed me of private insurance options which are to be paid in cash and their flexibility compared to the HPS. After evaluating the plans, it seems to be a term plan covering the mortgage amount. I already have enough coverage for this amount and excess for my family. Also, I have a chronic condition which means any new policy will involve loading (additional premium to be paid).
No harm going for medical underwriting first to see what the outcome is, before deciding whether to proceed or not.
Having sufficient death/TPD insurance is important for the loan, and it good that you know that what you currently have is sufficient for the amount. However, note that if you have a whole life with CI coverage, the purpose of such a plan is not for the event of death/TPD. Imagine a situation where you contract a CI, burn through the payout, and then pass away. There would still be insufficient death/TPD cover.
So it is plausible to have a standalone plan for death/TPD cover to protect the loan, as the flexibility provided and the ensuring liquidity ensures the surviving family members will have options available to them. HPS only negates the loan and still leaves the family cash strapped.
Compare the premium u need to pay for level term plan vs CPF HPS.
You will see that it's cheaper to pay for level term plan insurance.
On another hand with your declaration, i'm doubtful CPF will cover you for the HPS plan.
So if you want to try, just go with HPS first, then try external insurance if HPS doesn't allow it.