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Fiscal Agents Products & Services
CDIC - Protecting Your Deposits

Canada Deposit Insurance Corporation (CDIC) is a federal Crown corporation that was created in 1967 to protect the money you deposit in member financial institutions in case of failure.

CDIC's members are banks, trust companies and loan companies and display this sign:

CDIC sign

You may read the following information in the order presented, or use the following questions to jump directly to the information you seek:



What does CDIC Insure?

CDIC insures eligible deposits you make with our members. Insurable deposits include:

  • savings and chequing accounts;
  • term deposits, such as guaranteed investment certificates (GICs),
    and debentures issued by loan companies;
  • money orders and drafts;
  • certified drafts and cheques; and
  • traveller's cheques issued by members.
To be eligible for deposit insurance protection, your deposit must be payable in Canada, in Canadian currency. Term deposits must be repayable no later than five years after the date of deposit.

Not all deposits and investments offered by our members are insurable.
For example, CDIC does not insure:

  • foreign currency deposits (e.g. accounts in U.S. dollars);
  • term deposits with a maturity date of more than five years from the date of deposit;
  • debentures issued by chartered banks;
  • bonds and debentures issued by governments and corporations;
  • treasury bills; and
  • investments in mortgages, stocks and mutual funds.


What is the maximum insurance protection?

Basic Protection:

By law, the maximum basic protection for eligible deposits is $100,000 per depositor (principal and interest combined) in each member institution Deposits are not insured separately in each branch office of a member institution.

Separate Protection:

CDIC provides separate protection for joint deposits, deposits held in trust, and deposits held in registered retirement savings plans (RRSPs) and in registered retirement income funds (RRIFs)

You are responsible for ensuring the member institution's records include all information required for the separate protection of these deposits. (see following sections for details)

Joint Deposits

Deposits you own jointly with someone else are insured separately from in your name, provided that the records of the member institution:

  • indicate the deposits are owned jointly, and
  • indicate the name and address of each joint owner.

The maximum insurance for all deposits having the same joint owners at each member institution is $100,000 (collectively, not per individual owner).

Trust Deposits

Deposits held in trust are insured separately from deposits owned individually by the trustee or the beneficiary, provided that the records of the member institution:

  • state that the deposit is held in trust,
  • identify the name and address of the trustee(s), and
  • identify the name and address of the beneficiary(ies).

At each member institution, all eligible deposits having both the same trustee and the same beneficiary are combined, and the total insured to a maximum of $100,000.

If a trust deposit has more than one beneficiary, the portion owned by each beneficiary must be identified on the member institution's records and updated each year as of April 30. Each beneficiary's portion is insured up to $100,000.

Registered Plans

CDIC does not insure all funds held in registered plans. To be insurable, deposits must be held in savings accounts or in term deposits with a maturity date not exceeding five years, and must be payable in Canadian currency.

  • Your maximum deposit insurance for all deposits held in RRSPs with the same member, including those placed by the trustee of your self-directed plan, is $100,000 (principal and interest combined).
  • Your maximum deposit insurance for all deposits held in RRIFs with the same member, including those placed by the trustee of your self-directed plan, is $100,000. (principal and interest combined).
  • Contributions you make to a spousal plan are combined with other deposits held in plans under your spouse's name at the same member, not with deposits in your name.


What happens if a member institution fails?

  • It is not necessary to file a claim with CDIC.
  • CDIC writes to the insured depositors advising them of how and when they will receive payment.
  • Payments are made as soon as possible (normally within two months).
  • The payment includes principal and interest up to $100,000.
  • No interest will be paid from the date the Court officially closes the failed institution, except in extraordinary circumstances (e.g. CDIC takes more than six months to repay insured depositors).
  • To avoid collapsing registered plans, CDIC transfers the insured funds to another member.

EXAMPLE

The following example shows how deposit insurance applies to eligible deposits at a CDIC member institution.
All amounts include principal and interest.

Depositor Details Insured Uninsured
Carole Savings $15,000    
Chequing $3,000    
Mutual Funds $50,000    
Total: $68,000 $18,000 $50,000
Carole, RRSP Term deposits $40,000 $40,000 -
Mutual funds $15,000 - $15,000
Robert,
in trust for Carole
Term deposits $50,000 $50,000 -
Paul Chequing $2,000    
Term Deposits $25,000    
Total: $27,000 $27,000 -
Paul, RRSP $ U.S. savings $5,000 - $5,000
Term Deposits $50,000 $95,000 -
Savings $45,000
Paul, RRIF Term Deposits $175,000 $100,000 $75,000
Carole and Paul, jointly Savings $20,500    
Term Deposits $85,000    
Total: $105,500 $100,000 $5,500
Paul and Robert, jointly Savings $5,000 $5,000 -

More examples of CDIC Coverage are provided at their web site, including Basic Coverage, Joint Deposits, Deposits Held in Trust, Deposits Held in RRSPs, and Deposits Held in RRIFs.


What does CDIC Insure?


CDIC's member institutions fund deposit insurance through premiums paid on the insurance deposits they hold. If required, CDIC is authorized to borrow additional funds, which the Corporation repays with interest.

The information in this document is presented in a non-technical way and is not intended to be a legal explanation of CDIC's Act and By-laws.

March 1996


Additional information or a CDIC Membership brochure can be obtained by calling

1-800-461-CDIC (That's 1-800-461-2342)

or write:
CANADA DEPOSIT INSURANCE CORPORATION
50 O'Conner Street, 17th Floor
P.O.Box 2340, Station D
Ottawa, Ontario
K1P 5W5





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