In forceAmended2020 Revised Edition

Contents

Deposit Insurance and Policy Owners’ Protection Schemes Act 2011 · 2020 Revised Edition · Part 9 · Compensation and Use of Ppf Life Fund and Ppf General Fund

47. Entitlement to compensation for life business

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Amended

Last amended by an amending law of 2018.

(1)

Subject to subsections (3) and (6) and section 49, where an insured policy owner has one or more insured policies covered under the PPF Life Fund issued by a failed PPF Scheme member which —

(a)

is or are issued to the insured policy owner; or

(b)

is or are issued to the insured policy owner jointly with one or more other persons as joint policy owners,a covered party is entitled to compensation from the PPF Life Fund of one or more of the amounts mentioned in subsection (2).

(2)

The amounts mentioned in subsection (1) are —

(a)

in the case of a Category 1 insured policy mentioned in the Second Schedule, an amount equivalent to the product of the protection ratio mentioned in paragraph 2(a) of the Fourth Schedule and the amount of policy moneys payable in respect of that insured policy;

(b)

in the case of a Category 2 insured policy mentioned in the Second Schedule, an amount equivalent to —

(i)

the product of the protection ratio for the sum assured mentioned in paragraph 2(b) of the Fourth Schedule and the sum assured guaranteed under that insured policy, or (if part of the sum assured guaranteed under that insured policy had previously been paid out under the insured policy) the remaining amount of the sum assured in the event that a claim event occurs before the quantification date;

(ii)

the product of the protection ratio for the surrender value mentioned in paragraph 2(c) of the Fourth Schedule and, as the case may be —

(A)

the surrender value guaranteed under that insured policy in the event that the insured policy owner, or the trustee of the trust of the insured policy, has given written notice to the failed PPF Scheme member to surrender that insured policy before the quantification date; or

(B)

the remaining amount of the surrender value guaranteed under that insured policy in the event that payment of claims had been made to a covered party before the quantification date; or

(iii)

the sum of sub-paragraphs (i) and (ii), where applicable;

(c)

in the case of a Category 3 insured policy mentioned in the Second Schedule, an amount equivalent to the product of the protection ratio mentioned in paragraph 2(d) of the Fourth Schedule and the amount of policy moneys guaranteed to be payable under the annuity by the failed PPF Scheme member; and

(d)

in the case of a Category 4 insured policy mentioned in the Second Schedule, an amount equivalent to —

(i)

the product of the protection ratio for the sum assured mentioned in paragraph 2(e)(i) of the Fourth Schedule and the sum assured guaranteed under that insured policy in the event that a claim event occurs before the quantification date;

(ii)

the product of the protection ratio for the surrender value mentioned in paragraph 2(e)(ii) of the Fourth Schedule and the surrender value guaranteed under that insured policy in the event of a surrender before the quantification date; or

(iii)

the product of the protection ratio for the commuted value mentioned in paragraph 2(e)(iii) of the Fourth Schedule and the amount of policy moneys which are guaranteed to be payable in the case of an annuity.

(3)

Subject to subsection (4), where any of the insured policies mentioned in subsection (1) is an insured policy which is covered under the PPF Life Fund —

(a)

the insured policy owner;

(b)

the trustee of a trust of the insured policy;

(c)

any beneficiary of the insured policy; or

(d)

any combination of persons mentioned in paragraph (a), (b) or (c),is or are entitled to compensation from the PPF Life Fund of the full amount of the protected liabilities in respect of the insured policy.

(4)

Where a combination of the persons mentioned in subsection (3)(d) are entitled to compensation from the PPF Life Fund, their total compensation must not exceed the full amount of the protected liabilities in respect of the insured policy.

(5)

The determination of the amount of compensation payable under an insured policy mentioned in subsection (2) must only include the accumulated values (including interest which has accrued on such values) of coupon deposits, advance premium payments and unclaimed moneys under the insured policy, insofar as they relate to an insured policy that provides fully guaranteed or partially guaranteed benefits.

(6)

Where a claim event for an insured policy has occurred, or where an insured policy has been terminated, on or before the quantification date, there must be deducted from the amount of compensation mentioned in subsection (2) —

(a)

any outstanding loan taken out against that insured policy; and

(b)

any outstanding premiums owed by the policy owner for that insured policy.

Terms defined in s 2

claim event
Defined · s 2
“claim event” means the contingency upon which policy moneys are payable under an insured policy;
Open s 2
commuted value
Defined · s 2
“commuted value”, in relation to an insured policy which provides for the payment of an annuity, means the present value of the expected future payments to be made —(a)for a term dependant on the continuation of human life; or(b)upon the death of the life assured or surrender of the insured policy by the insured policy owner,as specified under the terms of the insured policy;
Open s 2
covered party
Defined · s 2
“covered party” means —(a)an insured policy owner of an insured policy which is covered by the PPF Life Fund or the PPF General Fund, as the case may be;(b)the trustee of a trust of an insured policy which is covered by the PPF Life Fund or the PPF General Fund (as the case may be), in that capacity; or(c)a beneficiary in relation to —(i)an insured policy which is covered by the PPF Life Fund or the PPF General Fund, as the case may be; or(ii)an accidental death insurance cover provided by a PPF Scheme member before the inception of an insured policy;
Open s 2
failed PPF Scheme member
Defined · s 2
“failed PPF Scheme member” means a PPF Scheme member in respect of which the Authority has made a determination under section 46(1) that the PPF Life Fund or the PPF General Fund is to be utilised for one or more of the purposes mentioned in section 46(2), and any reference to “failure” in relation to a PPF Scheme member is to be construed accordingly;
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insured policy
Defined · s 2
“insured policy” means —(a)any life policy;(b)any accident and health policy;(c)any compulsory insurance policy; or(d)any specified personal line insurance policy which is a Singapore policy;
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insured policy owner
Defined · s 2
“insured policy owner” means the policy owner of an insured policy;
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policy
Defined · s 2
“policy” has the meaning given in the First Schedule to the Insurance Act 1966;
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policy owner
Defined · s 2
“policy owner” has the meaning given in the First Schedule to the Insurance Act 1966;
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PPF Life Fund
Defined · s 2
“PPF Life Fund” means the Policy Owners’ Protection Life Fund established under section 34(1)(a);
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protected liabilities
Defined · s 2
“protected liabilities” has the meaning given in the Third Schedule;
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protection ratio
Defined · s 2
“protection ratio” has the meaning given in the Fourth Schedule;
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quantification date
Defined · s 2
“quantification date” means —(a)in the case of a DI Scheme member —(i)that is wound up by a court in Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(ii)that is wound up by a court in a country or territory outside Singapore, the date of commencement of winding up under the law of that country or territory;(iii)that is wound up by a court in Singapore and by a court in a country or territory outside Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(iv)that is wound up voluntarily in Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(v)that is wound up voluntarily in a country or territory outside Singapore, the date of commencement of winding up under the law of that country or territory;(vi)that is wound up voluntarily in Singapore and in a country or territory outside Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018; or(vii)in respect of which the Authority determines that compensation be paid out of the DI Fund under section 21(1) (whether the DI Scheme member is subsequently wound up or not), the date on which the notice of payment of compensation is published in the Gazette under section 21(4); and(b)in the case of a PPF Scheme member —(i)that is wound up by a court in Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(ii)that is wound up by a court in a country or territory outside Singapore, the date of commencement of winding up under the law of that country or territory;(iii)that is wound up by a court in Singapore and by a court in a country or territory outside Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(iv)that is wound up voluntarily in Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(v)that is wound up voluntarily in a country or territory outside Singapore, the date of commencement of winding up under the law of that country or territory;(vi)that is wound up voluntarily in Singapore and in a country or territory outside Singapore, the date of commencement of winding up under the Insolvency, Restructuring and Dissolution Act 2018;(vii)that is a co-operative society in respect of which the Registrar of Co‑operative Societies has made an order cancelling the registration of that society under section 89(1) of the Co‑operative Societies Act 1979, the date of the order; or(viii)in respect of which the Authority has made a determination under section 46(1) that the PPF Life Fund or the PPF General Fund is to be utilised for one or more of the purposes mentioned in section 46(2) (whether the PPF Scheme member is subsequently wound up or not), the date on which the notification of the Authority’s determination is published in the Gazette under section 46(6);
Open s 2
trust
Defined · s 2
“trust”, in relation to an insured policy which is covered under the PPF Life Fund or the PPF General Fund, means —(a)any trust of the policy moneys created under section 132(2) of the Insurance Act 1966;(b)any trust of the objects of the insured policy created under section 73 of the Conveyancing and Law of Property Act 1886;(c)any express trust created by the insured policy owner over the policy moneys; or(d)any resulting or constructive trust over the policy moneys;
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trustee
Defined · s 2
“trustee”, in relation to a resolution fund, means the entity appointed under section 99(2) of the Monetary Authority of Singapore Act 1970 as the trustee of the resolution fund;
Open s 2
unclaimed moneys
Defined · s 2
“unclaimed moneys”, in relation to an insured policy issued by a failed PPF Scheme member, means any policy moneys which, as a result of a contingency happening, have been ascertained by the failed PPF Scheme member to be due and payable under that insured policy before the quantification date but which have not been paid to or have been paid but not yet received by the person entitled to payment of the policy moneys.
Open s 2