Canada’s Deposit Insurance – Stop Complaining

By PAIP Canada staff

            Over the past few weeks, many Canadians have started asking questions about the country’s deposit insurance. The questions have varied from the amount of coverage available to why we don’t have the same coverage as our neighbors south of the border.

            There are many things to consider, but above all, there is one key component to never forget: your money is safe, you have nothing to worry about.

            For starters, the Canada Deposit Insurance Corporation (CDIC) covers up to $100,000 Canadian dollars per issuer in the event that they (the bank) go bankrupt. The caveat is the financial institution must be federally incorporated and be a bank (instead of an insurance company). For insurance companies, a separate agency called ASSURIS is in place to insure deposits. Both organizations provide a considerable amount of reassurance to Canadians. Again, your money is safe.

Where the equation gets a little more interesting is when one has money on deposit with a provincially incorporated (or registered) organization such as a credit union. Although each province has its own organization to insure deposits, each one differs from the CDIC. In fact, the coverage provided to provincially based organizations is usually much better than what’s offered by the CDIC.

In some provinces, deposits are guaranteed to an unlimited amount, while in others (such as Ontario), the amount guaranteed is no more than $250,000. In Ontario, this amount is protected by the Financial Services Regulatory Authority of Ontario (FSRA) and is extended to the clients of its 62 active members.

In all other provinces, the name of the organization that offers protection varies, but the good news is the protection is there, and often there’s no limit. An advantage for smaller organization over the larger ones.