Mortgage Insurance in Singapore: Do You Need It? Homejourney Benefits Explained

In Singapore, mortgage insurance is not legally mandatory for every home loan, but it is effectively compulsory if you use CPF for an HDB flat and strongly recommended for most bank loans to protect your family and improve financial security. Homejourney helps you decide if you need it, calculate the right coverage, and apply safely across multiple banks in one place.

This article is a focused cluster within our broader Homejourney mortgage pillar guide on home loan safety and planning. For full coverage of how much mortgage insurance you need and how it fits into your overall loan strategy, see: How Much Mortgage Insurance Coverage Do You Need: Homejourney Guide .

What Is Mortgage Insurance in Singapore?

In Singapore, mortgage insurance or home loan insurance is a policy that pays off your outstanding housing loan if you pass away, suffer terminal illness, or total permanent disability (TPD) during the loan tenure.[1][4][6] It is sometimes known as mortgage protection, housing loan insurance, or Mortgage Reducing Term Assurance (MRTA) for bank loans.[1][2][9]

There are three main forms:

Home Protection Scheme (HPS) – mandatory CPF Board mortgage-reducing cover for HDB buyers who use CPF OA to pay instalments.[1][6]
MRTA / Group Mortgage Insurance – bank-linked mortgage protection for private property or HDB bank loans (e.g. OCBC Group Mortgage).[1][5][9]
Level term or life insurance with sufficient sum assured – can be used as alternative coverage if it fully clears the loan.[1][6][9]

As someone who has helped many first-time buyers in estates like Punggol, Tampines and Queenstown, a recurring pattern is clear: families who took mortgage insurance early sleep much better, especially when they are stretching their Total Debt Servicing Ratio (TDSR) to buy a BTO or EC.

Do You Really Need Mortgage Insurance in Singapore?

Whether you need mortgage insurance depends on your property type, how you pay your instalments, and your family situation.

1. HDB Flats Using CPF OA – HPS Is Effectively Mandatory

If you buy an HDB flat and use CPF OA to service the loan, you must be covered under Home Protection Scheme (HPS) unless you are exempted with equivalent private coverage.[1][6]

Key points from CPF Board’s HPS rules:[1][6]

Mandatory for HDB flat owners using CPF OA for monthly instalments.
Coverage is mortgage-reducing and typically lasts until age 65 or until the loan is fully paid, whichever is earlier.[1][6]
You must be insured at least for the proportion of instalment you pay. If you pay 80% of the instalment and your spouse pays 20%, you must be covered for at least 80% of the outstanding loan.[1][4][6]
To be exempt, you must show proof of an equivalent private policy that fully clears your share of the loan on death, TPD or terminal illness.[1][6]

Insider tip from real cases in Sengkang and Yishun: many couples only insure 50–70% each to save on premiums when cash flow is tight. This might be acceptable if each spouse can still service the loan alone, but it does increase risk. Homejourney’s calculators help you model different coverage percentages before deciding.

2. HDB or Private Property with Bank Loan – Strongly Recommended

For private condo, landed or HDB bank loans (especially where you use a mix of CPF and cash), mortgage insurance is optional but highly recommended.[1][2][9]

Most buyers choose one of these:

MRTA / Group Mortgage Insurance from banks like OCBC, DBS or UOB – coverage reduces in line with loan balance and tenure, with relatively lower premiums.[4][5][8]
Level term plans from insurers – coverage stays constant; useful if you want extra protection beyond the loan.[1][8][9]

From a safety perspective, homeowners in areas like Bukit Timah and Novena who stretch for million-dollar properties are especially exposed: a single health event without mortgage protection can force a fire sale. That is why Homejourney leans towards recommending at least 100% coverage for the main breadwinner, adjusted to your budget and obligations.

3. When You Might Not Need Extra Mortgage Insurance

You might decide not to take additional mortgage insurance if:

You are buying an HDB flat fully in cash (no CPF) and already have substantial life insurance and savings.
Your loan amount is small (e.g. a final S$100,000 over 8 years) and can be covered easily by existing assets.
You are single with no dependants and plan to sell or right-size quickly.

Even then, Homejourney recommends a careful review using our eligibility and affordability calculators at Bank Rates to avoid underestimating long-term risk.

MRTA, HPS, Home Loan Insurance: What’s the Difference?

Understanding the specific terms helps you compare options clearly.

HPS (Home Protection Scheme) – CPF-administered mortgage-reducing insurance for HDB flats where CPF OA pays the instalments.[1][6]
MRTA (Mortgage Reducing Term Assurance) – private mortgage insurance where coverage reduces as your loan is repaid, commonly used for bank loans.[1][2][4][9]
Group Mortgage Insurance – a form of MRTA offered by banks such as OCBC for their home loan customers; premiums often adjust annually as your loan declines.[5]
Home loan insurance / mortgage protection – generic terms covering all the above, including level term plans used to protect mortgages.[1][8][9]

For instance, OCBC’s Group Mortgage Insurance covers outstanding home loans against death, terminal illness or TPD, with premiums that automatically adjust yearly as you pay down the loan.[5] CPF Board’s HPS works similarly for HDB, except that premiums are typically paid from CPF OA and coverage ends by age 65.[1][6]

If you are unsure which suits you, Homejourney’s mortgage brokers can map options to your specific bank package (DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB and more) once you start a loan application via Bank Rates .

How Mortgage Insurance Fits into Your Home Loan (With Rate Context)

Mortgage insurance premiums are influenced by your loan size, tenure, age and health. The larger and longer your loan, the more coverage you need and the higher the premium.[1][2][5]

In 2026, most new bank loans in Singapore are pegged to 3M or 6M SORA (Singapore Overnight Rate Average) plus a fixed spread. As SORA and fixed-rate packages move, your monthly instalments, and indirectly your needed coverage, can change.[2][3][8]

The chart below shows recent interest rate trends in Singapore:

As rates fluctuate, some homeowners refinance to lower instalments. When you refinance via Homejourney, we help you reassess if your existing HPS, MRTA or term coverage is still adequate for your new loan amount and tenure.

Benefits of Applying for Mortgage Insurance via Homejourney

Homejourney is designed around safety, verification and convenience, especially for time-pressed buyers juggling work and family in estates like Jurong, Pasir Ris or Toa Payoh. Instead of visiting individual bank branches around Raffles Place or Tampines Hub, you manage everything digitally with transparency.

1. One Multi‑Bank Application for Loans and Protection

With Homejourney’s multi-bank application at Bank Rates , you submit your details once and receive loan options from major banks such as DBS, OCBC, UOB, HSBC, Standard Chartered, Maybank, CIMB, RHB, Hong Leong Bank, Public Bank and Citibank.

From there, our mortgage specialists help you:

Identify whether HPS, MRTA or term insurance best fits your property type and loan structure.
Match mortgage insurance coverage to your chosen loan package and tenure.[1][2]
Avoid under- or over-insuring, especially for joint owners with different income levels.