Disclosure Requirements for the Policy Owner's Protection Fund

Circular No. ID 21/11
27 December 2011
Principal Officers
All Insurers
Dear Sir
DISCLOSURE REQUIREMENTS FOR THE POLICY OWNER’S PROTECTION FUND The Deposit Insurance and Policy Owners’ Protection Schemes Act 2011 (“DI￾PPF Act”) came into effect on 1 May 2011 and the Deposit Insurance and Policy Owners' Protection Schemes (Policy Owners' Protection Scheme) Regulations 2011 (“the Regulations”) were issued on 21 July 2011. 2 Under the Regulations, PPF Scheme members are required to comply with the following disclosure requirements effective 1 Jan 2012:
Policies covered under the PPF Life
Fund
Policies covered under the PPF General
Fund a) To state in the policy contract and product summary whether the policy in question is covered by the PPF Life Fund. The disclosure statement will be standardised across the industry. b) To prepare an information sheet stating the scope and level of coverage of the PPF Life Fund to be provided to the policy owners together with the policy document. c) To send existing policy owners the information sheet. a) To state in the policy contract and product summary whether the policy in question is covered by the PPF General Fund. The disclosure statement will be standardised across the industry. b) Upon the renewal of the policy, to send a letter to policy owners of protected lines of business to inform them of the scope and level of coverage of the PPF General Fund, including informing them that their policy is covered. The disclosure statement will be standardised across the industry. 3 We had engaged the Life Insurance Association (“LIA”) and the General Insurance Association (“GIA”) to develop a standardised disclosure statement in August
2011. It was agreed then that the following disclosure statement will be used as the
standardised statement in policy contracts and product summaries:

"This policy is protected under the Policy Owners’ Protection Scheme which is administered by the Singapore Deposit Insurance Corporation (SDIC). Coverage for

your policy is automatic and no further action is required from you. For more information on the types of benefits that are covered under the scheme as well as the limits of coverage, where applicable, please contact your insurer or visit the GIA/LIA or SDIC web-sites (www.gia.org.sg or www.lia.org.sg or www.sdic.org.sg)." 4 We had received a number of queries on the wordings of the statement and would like to clarify that PPF Scheme members may amend the pronouns in the statement for ease of reading or presentation but to preserve consistency across the industry, should not amend the wordings of the disclosure statement. In particular, insurers offering bundled products should not add references to point out that only specified covers within the product are protected by the PPF Scheme to avoid confusion with other products offered by other PPF Scheme members. 5 For avoidance of doubt, PPF Scheme members may make additional disclosures on their websites or in other marketing forum, if they wish. Should you have any queries, please contact your company’s liaison officer in MAS. Thanks. Your sincerely (sent via MASNET) MS LUZ FOO EXECUTIVE DIRECTOR INSURANCE DEPARTMENT Cc: Singapore Deposit Insurance Corporation