Dependants' Protection Scheme: Why age cap set at 60

We thank Mr Su Kim Teck for his suggestion ("Raise age cap for Dependants' Protection Scheme"; last Friday).

The Dependants' Protection Scheme (DPS) is a term insurance scheme that provides a sum of money to help insured members and their families tide over the initial difficult period in the event of permanent incapacity or death.

Central Provident Fund members aged 21 to 60 will automatically be covered under DPS when they make their CPF contribution.

The age limit for DPS is set at 60 years old because, beyond that, the need for financial protection for the majority of members is likely to reduce as their dependants are likely to be already working or are less financially dependent.

In addition, the annual premiums for coverage beyond 60 years old would be significantly higher due to higher mortality rates. The additional premiums required to continue DPS coverage would be better reserved for the members' retirement.

Setting the age limit at 60 years old strikes a balance between the need for financial protection for the members' dependants and the need for adequate retirement savings.

Members who wish to purchase life insurance beyond 60 years old can still do so from private insurers.

Irene Kang (Ms)

Director, Communications Division

Central Provident Fund Board

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