Singapore Mortgage Insurance for Immigrants – Singapore

Singapore is one of Asia’s most prosperous and stable countries, offering a welcoming environment for expatriates and immigrants. 

When settling in Singapore, many immigrants aim to own property either for residence or investment. However, purchasing a home often requires financing through a mortgage. 

One key aspect often overlooked in this process is mortgage insurance—a protective financial instrument that can make homeownership more secure. 

In this guide, we’ll walk you through everything you need to know about mortgage insurance in Singapore, specifically for immigrants.

Understanding Mortgage Insurance in Singapore

Mortgage insurance is also known as Mortgage Reducing Term Assurance (MRTA) or Mortgage Decreasing Term Assurance (MDTA).

It is designed to cover outstanding home loan repayments in case of the borrower’s death or total permanent disability. It ensures that the remaining debt does not burden family members.

In Singapore, mortgage insurance is not always mandatory, but it is highly recommended, especially for immigrants who may not have local family support or government schemes to fall back on.

Why Immigrants Should Consider Mortgage Insurance

1. Financial Protection for Family

Immigrants usually move to Singapore for better opportunities, sometimes bringing their families along. If the mortgage payer unexpectedly passes away or becomes incapacitated, mortgage insurance helps ensure the family retains the property without financial distress.

2. Loan Approval Advantage

Some lenders may favor mortgage insurance when assessing a loan application. It adds a layer of risk mitigation, especially for foreign nationals, which might make the loan more favorable or easier to approve.

3. Peace of Mind

Mortgage insurance gives peace of mind to immigrants who might not have extensive social or financial safety nets in Singapore.

Types of Mortgage Insurance Available

1. Mortgage Reducing Term Assurance (MRTA)

This is the most common mortgage insurance in Singapore. The coverage amount decreases over time in line with your outstanding home loan. It’s more affordable compared to traditional term insurance.

2. Level Term Insurance

Unlike MRTA, the sum assured remains constant throughout the policy. This type offers more flexibility, especially if you decide to refinance or transfer your loan later.

3. Private Mortgage Insurance (PMI)

For immigrants making a lower down payment (typically less than 20%), some lenders may require PMI. This protects the lender if the borrower defaults.

4. Critical Illness Add-ons

Many insurance providers offer critical illness riders. While optional, these enhance coverage and are worth considering for additional protection.

Is Mortgage Insurance Mandatory in Singapore?

For HDB (Housing Development Board) flats, Singapore Citizens and Permanent Residents use CPF (Central Provident Fund).

Monthly repayments are required to purchase the Home Protection Scheme (HPS). However, this scheme is not available to immigrants.

For private property or executive condominiums, mortgage insurance is not mandatory. Still, banks may suggest or require borrowers—especially immigrants—to take up MRTA as a form of financial safeguard.

Leading Providers of Mortgage Insurance in Singapore

Here are some of the top providers offering mortgage insurance products that are accessible to immigrants:

AIA Singapore

• Offers MRTA with flexible premium terms.
  
• Option to add critical illness coverage.
  

Great Eastern Life

• Affordable mortgage-reducing term plans.
  
• Coverage up to 30 years with fixed premiums.
  

Manulife Singapore

• Known for level term insurance with extensive benefits.
  
• Suitable for borrowers considering refinancing in the future.
  

AXA Insurance

• Offers customizable plans with coverage for death, TPD, and critical illness.
  
• Digital application process, ideal for new immigrants.
  

NTUC Income

• Focuses on affordability and practical coverage.
  
• Strong local reputation and good claim service.
  

How to Apply for Mortgage Insurance as an Immigrant

1. Determine Your Eligibility

Most insurers require the applicant to be between 18–65 years old and have a valid long-term visa or Employment Pass in Singapore. Proof of income and health declaration will also be needed.

2. Choose the Right Type of Coverage

Based on your home loan amount and tenure, decide whether you need MRTA, level term insurance, or a plan with riders.

3. Compare Multiple Providers

Always compare policy benefits, premiums, exclusions, and claim processes across insurers before making a decision.

4. Submit Your Application

You’ll need:

• Proof of identity and immigration status
  
• Home loan documents
  
• Income statements
  
• Medical records (if applicable)
  

5. Undergo Medical Checks (if required)

Some plans may require basic health checks depending on your age, health condition, and coverage amount.

Costs Involved in Mortgage Insurance

The cost of mortgage insurance in Singapore varies based on:

• Your age and health
  
• Sum insured (equal to your loan amount)
  
• Loan tenure
  
• Type of coverage (MRTA or level term)
  
• Optional riders like critical illness or disability protection
  

Example: For a 35-year-old non-resident with a 25-year S$500,000 mortgage, MRTA might cost between S$8,000–S$15,000 for a single premium or around S$400–S$600/year for regular premium plans.

Tips for Immigrants Buying Mortgage Insurance in Singapore

Plan Ahead

It’s better to purchase mortgage insurance when you’re young and healthy for lower premiums.

Understand Exclusions

Read policy exclusions carefully, such as pre-existing conditions, suicide clauses, or unpaid premium consequences.

Bundle with Home Loan

Some banks offer bundled deals when you take mortgage insurance alongside your home loan. Compare to see if this is cheaper.

Review Periodically

Reassess your policy if your mortgage is refinanced or paid off early. You may need to change your plan.

Alternatives to Mortgage Insurance

If you’re not keen on a separate mortgage insurance policy, consider these options:

• Term Life Insurance: This offers broader coverage and can be used for other financial needs.
  
• Endowment Policies: These provide savings and protection, although premiums are higher.
  
• CPF Shielding (For PRs): If you’re a PR using CPF, some integrated plans can help cover your mortgage.
  

Final Thoughts

Mortgage insurance is a crucial financial safety net for immigrants planning to build a life in Singapore. 

It not only protects your property investment but also secures your family’s future. While not compulsory for most foreign buyers, having a good policy ensures you don’t leave things to chance in times of uncertainty.

Whether you’re just arriving or already settling down in Singapore, mortgage insurance is a smart step toward long-term stability and financial resilience.