Home Protection Scheme (HPS): The Mortgage Insurance Most HDB Owners Didn’t Choose, But Need
Last updated: October 2026. Not financial advice. All figures for educational reference only.
The Home Protection Scheme (HPS) is a mortgage-reducing term insurance scheme that is compulsory for CPF members using their CPF Ordinary Account to service an HDB housing loan, paying off the remaining loan balance if the insured member dies, is diagnosed with a terminal illness, or becomes totally and permanently disabled before age 65.
Key Takeaways
- HPS is compulsory if you use CPF Ordinary Account savings to pay your HDB (or HDB-related bank) housing loan instalments.
- The sum assured tracks your outstanding loan balance, so it shrinks every year as you pay down the mortgage — unlike a flat sum-assured term life policy.
- Premiums are deducted automatically, once a year, from your CPF Ordinary Account, so there is no cash outlay for most members.
- Coverage runs until age 65 or until the housing loan is fully repaid, whichever comes first — it is not portable if you switch flats and must be reapplied for, subject to health declaration.
- You can apply for an exemption if you already hold an equivalent private mortgage insurance policy, such as Mortgage Reducing Term Assurance (MRTA).
What Is the Home Protection Scheme?
HPS has existed since 1982 and is one of the longest-running compulsory insurance schemes tied to CPF. Its purpose is narrow but important: if the person responsible for an HDB mortgage dies or becomes permanently unable to work, HPS ensures the family does not also lose the roof over their heads because the outstanding loan is paid off in full.
Unlike DPS, which pays a fixed sum assured regardless of what you owe, HPS is a reducing term insurance — the amount it would pay out gets smaller every year as your housing loan balance falls, since its only job is to extinguish whatever loan remains at the time of the claim, not to replace lost income or provide for other needs.
Because the compulsory trigger is “using CPF OA to service an HDB loan,” members who pay their HDB loan entirely in cash, or who take a bank loan for a private property, fall outside the default HPS requirement — though HDB loans specifically require HPS unless you have an approved exemption via an equivalent private policy.
How Does the Home Protection Scheme Work in Singapore?
If you are using CPF OA savings to service your HDB housing loan instalments, HPS cover is automatically required. The sum assured is set to match (and track down with) your outstanding loan balance, and the premium is recalculated and deducted from your CPF OA once a year.
A claim is payable on death, terminal illness, or total permanent disability before age 65. When a valid claim is approved, the outstanding HDB loan balance at that point is paid off directly, which means your family keeps the flat free of mortgage debt even if the main income earner is gone.
HPS cover is not portable: if you sell your flat and buy another one, you need to reapply for HPS on the new loan, and that fresh application is subject to a new health declaration. If your health has deteriorated since your first HPS application, there is a real risk of being charged a loading, or in serious cases, being declined — which is one reason some owners choose to supplement or replace HPS with a private Mortgage Reducing Term Assurance (MRTA) plan that may offer more flexible underwriting or portability terms.
the Home Protection Scheme Example
A couple buys a 4-room HDB flat with a S$400,000 HDB loan, serviced using both their CPF Ordinary Accounts. HPS cover is automatically applied on the husband, who is the main mortgagor, with the sum assured initially matching the S$400,000 outstanding loan. Over the next ten years, as the loan is paid down to S$280,000, the HPS sum assured falls in step, and the annual premium (deducted from his CPF OA) is recalculated accordingly each year.
In year eleven, the husband is diagnosed with a terminal illness. A valid HPS claim is submitted, and the remaining S$260,000 loan balance at that time is paid off in full by the scheme. The flat is now mortgage-free, and the wife and children do not have to worry about defaulting on HDB loan instalments while grieving or managing medical bills.
Advantages of the Home Protection Scheme
- Keeps the family home out of a forced sale. Because the payout directly extinguishes the outstanding HDB loan, HPS removes the single biggest risk to a bereaved or disabled household: losing the flat because instalments can no longer be paid.
- No cash outlay for most members. Premiums are deducted automatically from CPF OA, so there is no monthly or annual bill to budget for out of take-home pay.
- Tracks your loan automatically. You do not need to manually adjust your coverage as you pay down the mortgage — the sum assured recalculates each year to match your declining balance, so you are never over-insured relative to what you actually owe.
- Covers total permanent disability, not just death. A member who becomes totally and permanently disabled and can no longer earn an income still has their mortgage extinguished, which is often the scenario families are least financially prepared for.
Risks and Limitations
- Coverage is not portable between flats. Selling your HDB flat and buying a new one means reapplying for HPS from scratch, with a fresh health declaration — if your health has declined, you may face a premium loading or be denied cover entirely.
- It only covers the loan, nothing else. HPS does not replace lost income, pay for your children’s education, or cover any other household expense — a family can still face serious financial strain even with the mortgage paid off.
- Cover ends at 65. If you are still repaying your HDB loan past age 65 (increasingly common with longer loan tenures), you no longer have HPS protection and need an alternative plan.
- Using CPF OA for premiums reduces your OA balance. Every dollar spent on HPS premiums is a dollar no longer earning CPF OA interest or available for other approved housing or investment uses.
HPS vs Mortgage Reducing Term Assurance (MRTA)
| Feature | HPS | Private MRTA |
|---|---|---|
| Applies to | HDB loans serviced with CPF OA | HDB or bank loans, any property type |
| Premium Payment | Deducted from CPF OA annually | Cash, or in some cases CPF OA/SRS depending on insurer |
| Portability | Must reapply when you move flats | Some policies are more flexible on porting cover |
| Underwriting | Health declaration at each new application | Health declaration at application; some simplified-issue options |
| Exemption | Can exempt HPS if an equivalent MRTA is held | Not applicable — MRTA is the private alternative |
| Coverage Age Limit | Up to age 65 | Varies by insurer, sometimes up to loan tenure end regardless of age |
Source: CPF Board; general MRTA product structures offered by Singapore insurers, 2026.
The Bottom Line
HPS exists for one specific job: making sure your HDB flat does not become a source of financial catastrophe on top of a death or disability in the family. For most CPF members using CPF OA to pay their HDB loan, it does that job automatically and cheaply, without requiring any action.
The trade-off is a lack of flexibility — no portability, a hard stop at age 65, and cover limited strictly to the loan balance. Homeowners who want more control, want cover beyond 65, or who are already juggling multiple properties should compare HPS against a private MRTA or term life policy before assuming the default CPF scheme is enough.
Frequently Asked Questions
Is HPS compulsory?
Yes, if you use your CPF Ordinary Account to service an HDB housing loan, HPS cover is compulsory unless you have an approved exemption via an equivalent private insurance policy.
How much does HPS cost?
Premiums are calculated annually based on your outstanding loan balance, age, and coverage term, and are deducted automatically from your CPF Ordinary Account — you can check the exact amount via the CPF website or app.
Can I be exempted from HPS?
Yes, if you hold an equivalent private mortgage insurance policy, such as an MRTA plan that provides comparable coverage, you can apply for an exemption from HPS.
What happens to HPS if I sell my flat?
HPS cover is tied to the specific loan on your current flat. If you sell and buy another flat, you need to reapply for HPS on the new loan, which involves a fresh health declaration.
Does HPS cover bank loans for HDB flats?
Generally HPS is associated with HDB loans serviced via CPF OA; if you take a bank loan instead for your HDB flat, check with your bank and CPF on whether HPS or an equivalent private MRTA applies.
What is the maximum age for HPS coverage?
HPS cover runs until age 65 or until the loan is fully repaid, whichever happens first.