The savings of Canadians are getting more protection as the limit of deposit insurance for an individual is raised from $60,000 to $100,000. The increase in deposit insurance coverage applies to banks, trust companies and loan companies who are members of the Canada Deposit Insurance Corporation (CDIC) and is retroactive to February 23, 2005.
The CDIC is a federal Crown corporation created to provide stability to the Canadian financial system. It insures eligible deposits of up to $100,000 per depositor at CDIC member institutions and will reimburse depositors if the financial institution fails.
Depositors do not have to apply for Canadian deposit insurance. The CDIC is funded by premiums assessed on its member institutions.
For deposits to be eligible for Canadian deposit insurance, they must be in Canadian currency and payable in Canada. Insurable deposits include
- savings and chequing accounts
- term deposits that are repayable no later than five years after the date of deposit
- money orders and drafts
- certified cheques
- traveller's cheques.
Separate protection is provided for
- joint deposits
- deposits held in trust
- registered retirement savings plans (RRSPs)
- registered retirement income funds (RRIFs).
