Financial Community

Notice: The Government of Canada has announced that changes to the CDIC Act to modernize and enhance CDIC deposit protection will come into force on April 30, 2020 and April 30, 2021. PLEASE NOTE: Until then, current coverage rules apply.

About Trust rules

Observing CDIC’s trust disclosure rules may have an impact on insurance coverage:

  • for the trust;
  • for the trustee’s personal accounts, separate from the trust;
  • for the beneficiary’s personal accounts, separate from the trust.

We consider a trustee to be the depositor for trust accounts. These are sometimes called ‘nominee’ accounts by financial professionals.

For example, if you are a trustee and you meet CDIC‘s trust disclosure rules, an eligible trust deposit will be insured separately from deposits you hold in your name. Each would be covered for up to $100,000 per beneficiary.

If trust disclosure rules are not met, deposits you hold in trust will be combined with deposits you hold in your name. Together these would be limited to a maximum of $100,000 in CDIC coverage.

The rules for nominee brokers and all other trustees that hold deposits for beneficiaries are set out in the “trust” section (i.e. section 3) of the Schedule of the CDIC Act and in the Joint and Trust Account Disclosure By-law. These are rules that all brokers should become familiar with regardless of whether you place deposits in client-name or in nominee-name.

Consult the following links for additional information:

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