The PPF scheme aims to offer protection to policyholders in the event of the insurer failing. The protection is 100% subjected to caps. For individual life and voluntary group life policies (with the exception of annuities), the cap is S$500,000 for the aggregated guaranteed sum assured and S$100,000 for aggregated guaranteed surrender value per life assured per insurer. My comments:

1. When consumers buy life insurance policies, they have to be mindful of this cap. It is quite common for individuals to buy their policies from one insurer if the adviser is a representative of one insurer. It will be unwise to make all purchases from one insurer. It is better to buy from multiple insurers.
2. The cap is easily breached whenever one buys a mortgage reducing term (MRTA). It is common for individuals to borrow large amounts of money for their housing purchase. It is common for the borrower to ...

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