When and how would I get my money?
Payments would be sent automatically, using bank records. CDIC would reimburse insured deposits up to $100,000 (including interest) per insurance category in accordance with the following payment schedule:
- CDIC would aim to reimburse deposits like chequing and savings accounts, within three business days from the date of failure.
- Deposits in valid trusts are protected up to $100,000 per beneficiary. CDIC would contact broker-trustees to inform them of its process to reimburse insured deposits. CDIC would remit payment to broker-trustees within seven business days of receiving wire transfer/payment information. Payment would be based on CDIC calculations and deposit information at the failed institution.
- CDIC would hold registered deposits in RRSPs, RRIFs and TFSAs while it works with the Canada Revenue Agency to ensure they remain tax-sheltered. CDIC would contact these depositors directly to inform them of next steps.
Depositors with funds that are not protected by CDIC would be able to file a claim with the liquidation firm after it is appointed by the courts.
Would CDIC cover ALL of my savings?
CDIC protects eligible deposits to a maximum of $100,000 for each of seven deposit categories. Depositors with funds that are not protected by CDIC would be able to file a claim with the liquidation firm after it is appointed by the courts. Contact information for the liquidation firm would be posted on CDIC’s website once the firm is appointed by the Court.
Would my GIC be eligible for coverage?
Term deposits, including Guaranteed Investment Contracts (GICs), with original terms to maturity of five years or less are eligible for CDIC insurance.
That means a GIC with an original term of seven years, for example, is not insured and would not become insured when two years of that term have passed and five years are left. What matters is the original term, not the amount of the term remaining.
What would happen with my operating loan/line of credit in a member institution failure?
Since the failed member institution would be closed, you would no longer have access to any funds from loans, lines of credit or similar credit accounts that you may have had with the member institution. You would need to make credit arrangements with another financial institution.
You would also still need to repay any debts that you owed to the member institution. To do this, you would need to make arrangements with the liquidation firm appointed by the Court to settle the member institution’s business affairs.
Would business accounts be covered?
Eligible deposits in the name of a partnership or corporation are covered to a limit of $100,000 per deposit category. These deposits would be covered separately from eligible personal deposits held in the names of the individuals who own the partnerships and incorporated businesses.
Owners of sole proprietorships, however, would not benefit from separate deposit protection.
How would trust deposits be handled by CDIC?
Deposits in valid trusts are protected up to $100,000 per beneficiary. CDIC would contact broker-trustees to inform them of its process to reimburse insured deposits. CDIC would remit payment to broker-trustees within seven business days of receiving wire transfer/payment information. Payment would be based on CDIC calculations and deposit information at the failed institution.
If a broker placed an insured deposit at the failed member institution on a client’s behalf, where would CDIC send the payment?
Payment would be sent to depositors unless the deposit is held in trust. Deposits in valid trusts are protected up to $100,000 per beneficiary. CDIC would contact broker-trustees to inform them of its process to reimburse insured deposits. CDIC would remit payment to broker-trustees within seven business days of receiving wire transfer/payment information. Payment would be based on CDIC calculations and deposit information at the failed institution.
How would you pay joint deposits?
Payments for joint deposits would be reimbursed per set of joint owners; that is, the joint owners together would receive a single payment of up to $100,000.
Does CDIC coverage of $100,000 include principal and interest?
Yes. Total coverage in each separately insured category, including principal and interest, is up to $100,000.
What would happen if I obtained a pre-approved mortgage right before the failure? What would its status be?
You would need to contact the liquidation firm appointed to settle the member institution’s business affairs.
If one CDIC member fails, should I be concerned about my deposits at other financial institutions?
Your eligible deposits in any other CDIC member institution would not be affected by the closure of a CDIC member and would remain protected up to $100,000 in each of seven separate deposit categories.
Could I transfer my insured deposits directly to another member institution instead of waiting for a cheque in the mail?
No. Cheques for insured deposits in savings accounts and joint accounts would be mailed to depositors.
Where should I take my money if my member institution has closed? How would I know which institution is safe?
All eligible deposits in any CDIC member institution are protected up to $100,000 in each of seven separate deposit categories. More than 95 percent of personal deposit accounts in our members are fully protected by CDIC.
If my member institution fails, what would happen to the automatic withdrawals I set up to pay my bills?
If your member institution failed and you use automatic withdrawals/payments from your accounts to pay mortgages, loans, taxes or to cover regular bills such as those for utilities or credit cards, these would no longer be processed.
You would need to contact your service provider/utility/other lender and relevant tax authorities to see whether scheduled payments from your accounts were processed prior to their closures. You would also need to make arrangements with them for future bill payments and to cover off any outstanding amounts.
What about paying mortgage and other debts?
If a CDIC member institution were to fail, customers would still be responsible for repaying money they owe. This includes mortgage payments. The liquidation firm appointed to settle the business affairs of the failed member institution would collect this money and contact customers to discuss their payments.
Can I deposit, cash or write a cheque on my account at the failed member institution?
Since deposits cannot be used or accessed once a CDIC member institution has failed, it would no longer be possible to deposit a cheque, to cash a cheque, or to write new cheques for funds held at the failed member institution. Uncashed cheques issued from an account at the failed member institution (even if written prior to the closure) would be returned.
Uncashed cheques issued by the failed member institution for interest earned on deposits would be included in the deposit insurance payment.
What would happen to direct deposits to my account at the failed member institution?
Direct deposits (such as paycheques or pension payments) into accounts at the failed member institution would no longer be processed. Depositors would have to contact the person or organization issuing these deposits to make new arrangements.