Proposed amendments in Deposit Insurance Act raised coverage limit to $50k

The increased coverage will raise the proportion of fully insured depositors from 83 per cent to 91 per cent.

According to the Deposit Insurance and Policy Owners' Protection Schemes Bill and the Insurance Bill in the first reading in Parliament, the coverage limit under the DI Scheme will be expanded from insuring only individuals and charities, to insuring all non-bank depositors. Examples of non-bank depositors are sole proprietorships, partnerships, unincorporated entities and companies.

This aims to mitigate potential cash flow problems of small business depositors in the event of a bank failure.

The separate coverate of CPF-related monies will also be raised from $20,000 to $50,000.

According to MAS, the insurance regulatory framework will be strengthened to allow MAS to immediately take action when dealing with a distressed insurer. This aims to preserve financial stability and protice policy owners.