Dependants’ Protection Scheme (DPS): What It Is & Is It Worth It?

The Dependants’ Protection Scheme (DPS) might have just landed on your radar, but what exactly does it offer?

Is it worth holding onto, or does it fall short of what you need?

In this guide, we’ll walk through what DPS covers, what it costs, and where it falls short, so you can decide if it’s right for you.

Let’s get into it.

What Is the Dependants’ Protection Scheme (DPS)?

The Dependants’ Protection Scheme (DPS) is a form of term life insurance designed to provide some financial protection for those insured under the scheme.

Is it compulsory? No.

DPS is optional, and you can choose to opt out if you wish. But should you? Read on to find out.

The scheme was privatised on 17 September 2005 and is available only to CPF members. Since 1 April 2021, it has been administered by a single insurer, Great Eastern (GE), taking over from Income Insurance. The CPF Board has since extended GE’s appointment as the DPS administrator to 2028.

Once enrolled, you’ll receive a welcome package from GE explaining the details of your coverage. If you were previously insured under Income Insurance, no action is needed, though you may need to submit a fresh nomination form to GE to keep your records up to date (more on nominations below).

What Does the DPS Cover?

Under the Dependants’ Protection Scheme (DPS), you’re insured for up to $70,000 until age 59 (last birthday). From age 60 to 64 (last birthday), the maximum sum assured drops to $55,000. Beyond that, coverage ends, and you’ll no longer pay premiums.

DPS provides payouts for the following insured events:

• Death
• Terminal Illness
• Total and Permanent Disability

DPS is a form of term insurance, so it doesn’t build up any cash value. The point is to give you maximum coverage at an affordable premium.

In simple terms, you pay a premium to stay covered. If you decide the coverage isn’t for you, you can opt out. Should you want to rejoin later, you’ll likely need to go through underwriting.

If you pay premiums all the way to age 65 without making a claim, you won’t receive any refunds or payouts. However, that’s a positive outcome, because it means you’ve stayed in good health throughout the years.

You’ll be automatically enrolled in DPS if you meet these criteria:

• You’re a Singapore Citizen or Permanent Resident
• You’re between 21 and 65 years old
• You’ve made your first CPF contribution

If you’re between 16 and 21 years old, you won’t be automatically enrolled, but you can apply manually to join the scheme.

What Are the Premiums for DPS?

Here are the premiums for DPS, based on your age at the point of payment:

Age	Yearly Premium (for $70,000 sum assured)
34 years and below	$18
35 – 39 years	$30
40 – 44 years	$50
45 – 49 years	$93
50 – 54 years	$188
55 – 59 years	$298
60 – 64 years	$298 (for $55,000 sum assured)

These rates took effect on 1 April 2021, when coverage was raised from $46,000 to $70,000 and premiums for most age bands were cut at the same time.

Keep in mind that premiums increase with age. Even if you start early, your premiums won’t be locked in. They’ll adjust as you move into higher age bands.

Alongside the Home Protection Scheme (HPS), the Dependants’ Protection Scheme (DPS) is one of the few life insurance plans that can be paid using CPF savings.

Other national schemes that allow payment through CPF savings include:

• MediShield Life
• Integrated Shield Plans
• ElderShield
• CareShield Life

By default, DPS premiums are deducted from your CPF Ordinary Account (OA). If your OA balance is insufficient, the deduction will be made from your CPF Special Account (SA). Should both accounts lack sufficient funds, you can make a cash payment.

DPS is an individual scheme, so premiums can only be paid from your own CPF account. If you’d like your parents or spouse to be covered under DPS, they’ll need to pay their premiums from their own CPF accounts.

How to Check If You’re Insured Under DPS?

Steps to check whether you have DPS:

1. Visit the CPF website
2. Log in using your Singpass
3. Under “my cpf”, go to “My dashboards”
4. Select “Providing for your loved ones”

If you’re covered, your DPS details will be displayed there.

Making a DPS Nomination

A DPS nomination directs the death claim benefit to the beneficiaries you name. This nomination applies only in the event of death.

For claims due to terminal illness or total and permanent disability, the payout will be made directly to the insured member instead.

By submitting a nomination, you make it easier for your family to receive the benefit without delays caused by legal processes.

A CPF nomination doesn’t cover DPS, as they’re separate schemes. To nominate beneficiaries for your DPS, you’ll need to complete and submit a nomination form to Great Eastern.

If you want to update your nomination later, just submit a new form.

And if you made a DPS nomination under Income Insurance before 1 April 2021, you’ll need to re-submit it with Great Eastern to keep it current.

Making a DPS Claim

What qualifies as an eligible claim?

Here are the claim definitions:

Terminal illness: an illness that is likely to result in the death of the member within 12 months

Total permanent disability:
(i) the inability to take part in any employment permanently, or
(ii) the total permanent loss of physical function of any of the following: both eyes, or two limbs, or one eye and one limb

(If you’re interested, check out our study on life insurance claim statistics in Singapore.)

But there are exclusions too.

DPS benefits will not be payable if the following happens in the first year:

• Member committed self-inflicted injury or suicide
• Member committed a criminal offence punishable by death
• The claim arose out of member’s own intentional criminal act

DPS will also not be payable if:

• Member was not in good health before the commencement of DPS cover
• Member provided false or misleading information
• The claim arose from wars or any war-like operations or participation in any riot

If you have an eligible claim, you’ll need to approach Great Eastern to begin the process. Be prepared to submit the required claim forms and supporting documents to facilitate the claim.

3 Reasons to Stick With DPS

Here are three key reasons to keep DPS:

1) Premiums are affordable

DPS premiums are relatively low, especially for younger individuals in the lower age bands. For $70,000 of coverage, the cost is minimal and unlikely to strain your budget. As long as you’re earning an income, paying the premiums shouldn’t be a challenge.

2) Ability to use CPF monies

While cash is versatile and can be used for various needs, CPF funds come with restrictions. DPS allows you to use your CPF Ordinary Account (OA) or Special Account (SA) funds to cover the premiums. This means you can save your cash for other expenses or commitments.

3) Provides some form of protection

Your income supports both you and the people who depend on you. DPS gives you a basic safety net if something unexpected happens. The automatic enrolment also saves you the hassle of applying, so you’re covered from the start.

The Downsides of DPS

Coverage may not be enough.

DPS is designed as a basic national scheme, providing coverage for everyone. However, the $70,000 payout may fall short, especially when factoring in the permanent loss of income.

Once the payout runs out, where does the money for ongoing expenses come from? If you’re the main breadwinner, proper income protection matters a great deal.

Also, DPS doesn’t cover critical illnesses, which are more likely to occur than death or total permanent disability when you’re young. These illnesses often come with significant medical costs and potential loss of income.

If you’re unsure how much coverage you need, consider using our life insurance calculator. For better protection, explore other insurance options like term or whole life plans. These provide higher coverage and may include critical illness benefits.

Conclusion

For young individuals, the premiums for DPS are low and typically paid via CPF, so there’s little reason to opt out. However, cost shouldn’t be your only consideration.

DPS offers a basic level of protection, but for most people, this “basic” might not be enough. It’s often the first life insurance plan someone has, sometimes unknowingly, but it’s unlikely to meet your long-term financial protection needs.

If you’re ready to take your financial planning further, start by assessing how much life insurance coverage you require. From there, explore other options such as term or whole life insurance plans that offer more comprehensive protection for you and your family.