Policy Owners’ Protection Scheme (Life Insurance)
The Policy Owners’ Protection (PPF) Scheme is an additional safety net that protects the interests of life insurance policy holders in the event a life insurer fails. The PPF Scheme is administered by the Singapore Deposit Insurance Corporation (SDIC).
All Life Insurance companies are regulated entities in Singapore. The PPF Scheme provides added assurance that there is a compensation scheme for policy owners to reduce the financial impact on individuals in the event an insurer defaults. Experience in other countries has shown that consumers are less likely to panic if and when things go wrong, if there is a mechanism in place to guarantee the safety of insurance policies.
All insurers registered by the Monetary Authority of Singapore (MAS) to carry out direct life business (other than captive insurer) are members of the Policy Owners’ Protection Scheme (PPF Scheme members).
What are the types of life insurance policies covered under the PPF scheme?
All life insurance policies (including riders) are covered. This would include policies issued to non-Singapore residents (offshore policies), but not policies issued by overseas branches of a registered direct life insurer incorporated in Singapore. Examples of life insurance policies include the following:
- Individual term policies
- Individual whole life policies
- Individual endowment policies
- Individual annuities
- Individual short-term or long-term accident and health (A&H) policies (e.g. Hospital Cash, Medical Expense, Personal Accident, Disability Income, Long-term Care)
- Group term policies
- Group whole life policies
- Group endowment policies
- Group annuities
- Group short-term or long-term A&H policies
What types of life insurance policies are NOT covered under the PPF scheme?
Life insurance policies issued by overseas branches of a registered life insurer incorporated in Singapore are not covered. For a registered direct life insurer incorporated overseas, only the life insurance policies issued by the branch in Singapore will be covered.
What does a policy holder need to do to be part of the PPF?
Nothing. Coverage is automatic and there are no charges. Marketing collateral and policy documents of life insurance products will clearly disclose which products are covered under the PPF.
Who is in charge of the PPF?
The Singapore Deposit Insurance Corporation (SDIC) administers the PPF Scheme in Singapore. The SDIC Board is accountable to the Minister in charge of the MAS..
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