You will be able to check and update the nominations that decide who receives your CPF and insurance.
After lesson 7.1, Daniel books a lawyer to write a new will. He feels the job is nearly done. Then Hui Min asks a question he cannot answer: does the will cover his CPF? His CPF is the largest thing he owns after his share of their future flat. And the term policy he bought three years ago names his mother as the person to be paid.
Neither of those is decided by a will. They are decided by nominations, which sit outside the will completely and are easy to forget once they are made. This lesson covers what CPF and insurance nominations do, what happens without one, and when to check them.
CPF savings are not covered by your will. Whatever your will says, it cannot pass on your CPF. The instruction that decides who receives your CPF savings when you die is a CPF nomination, made with the CPF Board.
In a nomination you name one or more people and the share each receives. When a member who has made a nomination dies, the CPF Board pays the savings to the nominees directly, without the family having to go to court first.
You can make or change a CPF nomination online through the CPF website with Singpass, or in person at a CPF service centre. Your CPF dashboard shows whether you have a nomination and when it was made. The website also explains who can act as a witness and how many you need.
If you die without a CPF nomination, the CPF Board passes your savings to the Public Trustee's Office. Your family then has to apply to the Public Trustee, which distributes the money according to the law: the Intestate Succession Act for non-Muslims, and Muslim inheritance law for Muslims. This takes longer, and the shares are set by law rather than by you.
There is a trap here for couples. For non-Muslim members, marriage revokes an existing CPF nomination. Daniel had nominated his parents when he started work. Once he married Hui Min, that nomination was cancelled. Unless he makes a new one, his CPF would go through the Public Trustee. The CPF website explains how marriage and other events affect a nomination, and the rules can differ for Muslim members, so check how they apply to you.
Insurance policies can carry their own nomination, made with the insurer under the Insurance Act. If a policy has a valid nomination, the payout goes to the nominees. If it has none, it goes into your estate and follows your will, or the intestacy rules if you have no will.
There are two kinds of nomination, and they work very differently.
A revocable nomination can name anyone. You can change or cancel it at any time without asking anyone, and you keep full control of the policy. The nominees receive the payout, but they have less protection, for example from your creditors.
A trust nomination can generally only name your spouse, your children, or both. It creates a trust for them over the policy's payout. Once it is made, you cannot change it, surrender the policy or use it as security without the agreement of the trustee or the nominees. In return, the payout is ring-fenced for your spouse and children and is generally protected from your creditors.
Which kind fits a policy depends on who you want to protect and how fixed you want the arrangement to be. A parent with young children might want certainty for them. Someone whose family situation may still change might want flexibility. Each insurer has its own forms and rules on which policies can carry which kind, and group policies through an employer may work differently. Muslims should check with their insurer, and with the Syariah Court where relevant, how insurance nominations apply to them. Lesson 8.2 of The Singapore personal finance system, CPF and insurance nominations, covers the same ground from the single person's side.
Nominations go out of date quietly, because nothing reminds you they exist. Check every nomination after three events in particular.
After marriage, because a CPF nomination made while single has been revoked for non-Muslims, and any insurance nominations probably still name your parents or siblings.
After a child is born, because a new child is not added to anything automatically.
After a separation or divorce, because an old nomination may still name your former spouse. Module 8 returns to the timing of this, which is best decided with legal advice.
Daniel logs in to his CPF dashboard and finds no current nomination. His term policy still has a revocable nomination naming his mother. He and Hui Min agree to fix both before their flat's keys arrive.
Do what Daniel did. Log in to your CPF dashboard and check your nomination status, and gather each of your insurance policies, so you can see the nominee currently named on each.
Check your CPF nomination status online and list each insurance policy with its current nominee.
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