What happens to my insurance payout if I die without making a nomination?

CPF Nomination and Distribution Without Nomination

If you pass away without a valid CPF nomination, your CPF monies (including balances in Ordinary Account (OA), Special Account (SA), and Retirement Account (RA), as well as amounts in your MediSave Account (MA)) will be distributed according to the Intestate Succession Act (if you are not Muslim) or the Distribution Act (if you are Muslim). This process is managed by the Public Trustee's Office (PTO) under the Commissioner of Estate Duty (CED).

Impact of No Nomination

• Nomination Overrides All: A valid CPF nomination overrides any instructions in your Will or Trust regarding CPF monies. Without a nomination, the distribution follows the law, regardless of what your Will states.

• Distribution Process: The PTO will administer the distribution. For non-Muslims, distribution follows the Intestate Succession Act, which dictates shares based on surviving family members (spouse, children, parents). For example, if you are survived by a spouse and children, the spouse typically receives half, and the children share the other half.

• Exclusions from Distribution: It is crucial to note that certain assets are NOT covered by the CPF nomination rules and are distributed via your Will or the law: CPF Investment Scheme (CPFIS) funds, Direct Purchase Plans (DPP) with Great Eastern (GE), and properties bought using CPF.

• Liquidity and Timeframe: The distribution process under intestacy can take significantly longer than if a nomination is in place, as the PTO must verify all legal heirs. This means your beneficiaries may face delays in accessing the funds.

Practical Consideration (99:1 Tip)

While not directly related to dying without nomination, the CPF Board advises having a valid nomination. If you have a nomination, ensure you have a backup nominee (e.g., using the 99:1 tip) in case your primary nominee predeceases you, preventing the funds from falling under intestacy rules.

Key Takeaway: Dying without a nomination subjects your CPF savings to the legal distribution framework, which can lead to delays and distribution shares that may not align with your wishes.