The Home Protection Scheme is an insurance scheme that is provided by the CPF Board and aims to safeguard HDB properties from being given up in the case of an inability to make monthly housing payments. It protects against mortgage foreclosures in the cases of total permanent disability (TPD), terminal illness (TI), or death, and hence allows the original owner and/or family members to continue staying at the property in the wake of difficult times by ensuring that monthly loan payments continue to be made.
Generally, new property owners will fill out the HPS application while they are applying for property financing through HDB or private banks; as part of this application they will fill out a health declaration form and if requested, undergo a medical examination to assess their suitability for the scheme coverage.
In the case that a claim must be made – that is, when the owner has suffered a TPD, TI, or death – how can this be done?
When can I file a claim?
As mentioned, in the cases of death, total permanent disability (TPD), or terminal illness (TI). To define these specifically, TPD and TI would refer to a condition certified by an accredited doctor where the patient will:
- in TPD, be unable to work permanently or suffer the permanent loss of both eyes, both limbs, or an eye and a limb.
- in TI, pass away within 12 months due to illness
As of the time of writing, claims can only be made if the total permanent disability or terminal illness started on or after 1 May 2016.
Unfortunately, the claim application may be rejected if the member has committed suicide or self-harmed to cause TPD/TI/death. It will also be rejected in the cases where a member committed a crime that resulted in death, or if the member intentionally carried out a criminal act that resulted in TPD/TI/death and therefore warranted a claim. Lastly, it will also not apply if the claim resulted from wars, warlike operations, or riot participation.
HPS benefits could also be revoked if it was found that the member had provided misleading information, especially in the health declaration and about their health prior to issuance of HPS coverage.
What documentation do I need to file my claim? How do I file my claim, or how do I file the claim for my ill/incapable relative?
In the case of TI, you will need a medical report from the member’s doctor that details the TI that is no older than 6 months. In the case of TPD, you will need a medical report from the member’s doctor that details the TPD that is also no older than six months. Additionally, the member in question should already have stopped physical employment – this will look like a letter from their last employer, or a letter detailing the cancellation of the self-employed license. In the case of death, simply provide the death certificate of the person in question.
Any other supporting documents may help as well – for instance, in the case of injury resulting in TI or TPD, members may wish to provide incident reports (police reports) or insurance reports.
Members who are able may submit the claims themselves through an online application on myCPF under the Home Protection Scheme tab, by selecting the ‘Apply to Claim on Medical Grounds’. If necessary, CPF may request further examination by doctors under the CPF Board to further ascertain the member’s condition.
In the case of death, a different process is enacted. The Immigration and Checkpoints Authority (ICA) will notify CPF of the death, and a letter will be sent to the address of the deceased member for family members to apply for the HPS claim. Alternatively, you may also file to ‘Notify a Death’ via myCPF online. You will need to attach a copy of the death certificate for this.
If you are unsure whether your family member was enrolled in the scheme, you should write to them via their online form. Select ‘Housing/Property’ as the subject, and ‘Appeal – Home Protection Scheme’ as the category before noting your query. An officer will get back to you as soon as they are able.
What happens after I submit the claim?
If the claim is accepted, then monthly housing payments will be paid out to ensure that the property is paid for. The payments will be made directly to the Housing & Development Board or to the private bank or mortgagee directly, as they are the ones to whom the monies are owed to settle the outstanding housing loan.
If the member has passed away (i.e. the claim was made on the grounds of death), then a lump sum payment is made to either HDB or the private mortgagee, depending on where the member got their loan from. If the claim was made under medical grounds (TPD, TI), the monthly housing instalments (based on what percentage of the HPS the member is covering) will be paid out to HDB or the mortgagee for up to two years. In the latter case, after two years have passed, the member will be reassessed for whether payments can continue to be made.
If the HPS sum is higher than the loan that is outstanding on the property, excess amounts will be deposited into the CPF account (Ordinary Account) of the deceased member. The funds will then follow and be provided to the beneficiary of the CPF account.
If there is a co-owner that is sharing the insurance of the Home Protection Scheme, then their share of the HPS cover will simply be adjusted to cover the remainder of the outstanding loan in the wake of a claim.
Furthermore, there are no restrictions on the HDB flat after the benefits have been claimed – you can sell the flat as per usual if desired. If you do sell the flat, you will need to refund the principal CPF amount withdrawn for the flat as well as the accrued interest, but this will be returned to your account rather than the deceased owner’s account.
When it comes to housing, it is a big milestone in life. Should you be concerned on mortgage coverage or need advice in financial planning pertaining to mortgage, housing or just advice for the next phase in life, simply get in touch by filling up the form below and our financial advisor will get in touch with you soonest.