On June 4, 1996, about 2,600 Canadians discovered that their savings were not immediately available from their financial institution. They had entrusted a total of $42 million in deposits to Calgary-based Security Home Mortgage Corporation, which had closed its doors for good. The news must have momentarily sent a shiver of fear through each of its clients. Fortunately, this failed financial institution was a member of the Canada Deposit Insurance Corporation (CDIC) so customers’ eligible deposits were protected up to $60,000, per separate insured category. Coverage was free and automatic, no one ever had to apply for it, nor did they have to file a claim, payment was automatic. Within a span of three weeks, CDIC made payment of all insured deposits.

That was 20 years ago. CDIC can now pay out depositors in a matter of days. Since its creation in 1967, CDIC has stepped in following the failure of 43 member institutions like Security Home. In fact, during the past five decades, it has protected more than two million people holding about $26 billion in insured deposits at these failed institutions. No one has lost a single dollar under CDIC protection.

Although bank failures are rare in Canada, CDIC is there to protect deposits at its member institutions, big or small. In the case of larger members, CDIC has plans to ensure that all of us would have ongoing access to our deposits and day-to-day banking services.

But some things are not protected by CDIC. For example, stocks, bonds, and mutual funds are not covered.

Take steps to ensure that your money is safe by becoming informed about CDIC’s member institutions, insured categories, and limits. Talk to your financial advisor or ask about CDIC where you bank or invest.

Canadians are fortunate to have many options for managing their money. In fact, over 80 federally regulated financial institutions offer services for Canadians who are looking to save their hard-earned dollars.

The Canada Deposit Insurance Corporation (CDIC) was established by Parliament more than 50 years ago. Its job is to protect eligible deposits at member financial institutions, and it has a strong track record! Since its establishment, CDIC has protected depositors in 43 failures. Over two million depositors were protected, and not one person lost a dollar of deposits under CDIC protection.

However, not everything is covered. Here are 4 easy ways to see if your money is okay:

1. Is your bank a member of CDIC? You can check this list to find out.
2. Are your deposits eligible? Learn more.
3. Are you under the limit? CDIC protects deposits up to $100,000 in each of its deposit categories, which includes principal and interest.
4. Have you estimated your coverage? CDIC’s online calculator helps you look at your own personal situation.

For more details on all of these questions, talk to your financial advisor, ask about CDIC where you bank or invest, or contact CDIC.

Banks rarely fail in Canada. In fact, since Parliament created the Canada Deposit Insurance Corporation (CDIC) more than 50 years ago, there have been 43 failures of its member financial institutions. That may seem like a lot in a country where most of us believe that it can’t happen, but the last one occurred 20 years ago.

The important thing to remember is that CDIC protected depositors in each of those instances, and no one lost a single dollar under CDIC protection. But how does deposit insurance work? There are a few things you should know if you are concerned about the safety of your hard-earned money:

• Is my financial institution a member of CDIC?
• What is an insured eligible deposit?
• How do I get my money back if my bank fails?

Answers to these questions are available from your financial advisor where you bank or invest, on CDIC’s website, or by contacting CDIC.

Know that, CDIC is here for you, protecting your eligible deposits at our member financial institutions to a maximum of $100,000, per separate insured category, in the event of a failure. Coverage is free and automatic and customers never have to apply for it. If there’s a failure and deposits are insured, no claim needs to be filed, payment is automatic. Banks and other financial institutions in Canada seldom fail, but it has happened and could happen again.

Protecting savings is always important but it’s even more critical in retirement, since most Canadians will need to start drawing out the money they’ve put away. One way to ensure your money is safe is to deposit it in a financial institution that is a member of the Canada Deposit Insurance Corporation (CDIC).

RRIF protection

Everyone who saves money in an RRSP will have to start withdrawing cash from a RRIF the year they turn 72. Imagine what would happen if your bank failed that year and you couldn’t use your savings?

CDIC, a Crown corporation established in 1967, ensures that depositors’ eligible deposits are protected if one of its member financial institutions fails.

Up to $100,000 of cash and term deposits, such as Guaranteed Investment Certificates, held in a registered retirement income fund will be protected.

The same is true for eligible deposits in Tax Free Savings Accounts, as well as several other CDIC insurance categories.

Since 1967, no retiree — and no Canadian of any age — has lost a dollar of their insured deposits under CDIC protection due to the failure of a CDIC member institution.

If Canadians are worried about losing their savings, they can keep their money in CDIC insured products.

Trust coverage

The closer they get to retirement age, the more people will be thinking about the legacy they want to leave to their future generations.

Some boomers may want to set up a trust to keep some control over how their estates are distributed to their children and grandchildren after they pass away.

Fortunately, money in a trust is protected by the CDIC. As with a RRIF, CDIC will cover up to $100,000 of eligible cash and term deposits.

What’s different with a trust, is that each beneficiary is protected to the full amount. If you have $500,000 in one trust account, with $100,000 equally allocated to five different people, all of that money will be covered in the event of a bank failure provided the trust rules are followed.

Trust accounts are often very large and have a lot of beneficiaries. Each person will be protected if they comply with CDIC coverage rules.

Make sure your savings are protected with CDIC as much as possible.

As Canadians approach retirement, many of them decide to sell the family home and move to a condo or townhouse or to a smaller community in order to boost their retirement portfolio. But when closing day nets a large lump sum of savings, it’s especially important to ensure that these funds are as secure as they can be by familiarizing yourself with the Canada Deposit Insurance Corporation (CDIC) and understanding what their coverage includes. This means recognizing if you bank at a CDIC member institution, and the maximum amount each of your deposits are covered for in the event of a member institution’s failure. This protection is free and automatic, you don’t need to sign up.

If a bank ends up closing its doors, CDIC, a federal crown corporation, provides free and automatic protection for eligible deposits up to $100,000 per insured category for each depositor. If protecting your savings is important to you, then CDIC can help ensure your hard-earned money is safe.

Robust coverage

The CDIC will protect up to $100,000 in deposits invested in cash or in a guaranteed investment certificate (GIC). However, it doesn’t protect mutual funds and stocks.

Depositors need to keep an eye on their accounts as they grow, because any amount above $100,000 in a deposit category (e.g., deposits held in one name) at a member institution is not protected by CDIC.

More money, more accounts

In order to best maximize coverage, you need to know about CDIC’s different categories. Each of the following categories is insured separately for up to $100,000 for the eligible deposits they hold.

Eligible deposits include those:

• Held in one name;
• Held jointly;
• Held in trust;
• RRSPs;
• RRIFs;
• RESPs;
• TFSAs; and
• RDSPs.

By taking advantage of CDIC protection with member institutions – and maximizing that coverage – you can sleep well knowing your retirement dollars are covered by CDIC for up to $100,000 per insured category per depositor, no matter what happens to the bank.

As the annual tax filing deadline approaches, CDIC reminds Canadians to consider the $100,000 coverage limit for deposit protection as they plan their personal finances.

“Many people use their tax refunds to buy term deposits for their RRSPs, which are eligible for CDIC protection,” says CDIC Director of Communications and Public Affairs, Brad Evenson. “But they should not forget our $100,000 deposit insurance coverage includes both principal and interest. Check your balance. If your term deposit is now worth more than $100,000, that extra amount would not be protected by CDIC if your bank failed.”

Mr. Evenson noted depositors can obtain more than $100,000 in coverage by depositing their money in CDIC’s separately insured categories. For example, deposits in one name, joint deposits and trust deposits are each insured for up to $100,000.

Not all accounts and financial products that can be registered in an RRSP are eligible for CDIC coverage. For example, guaranteed investment certificates and other term deposits are covered, but mutual funds, bonds and stocks are not protected.

CEO Leah Anderson talks with Bruce Sellery, personal finance expert and host of the Moolala: Money Made Simple podcast, about how deposit insurance works and how CDIC protects your deposits.

OTTAWA –December 10, 2021 – The Canada Deposit Insurance Corporation’s (CDIC) 2021 Annual Report was tabled today in Parliament.

“When the COVID-19 pandemic struck early in 2020, CDIC took rapid action to reassure Canadians about the safety of their hard-earned savings, and to enhance our readiness for resolving crises in a climate of financial uncertainty” said Leah Anderson who joined CDIC as President and CEO in August 2021. “CDIC, through its readiness activities, is well-prepared to protect depositors under any circumstance that might arise.”

This was particularly important as the Report indicates deposits insured by CDIC increased by 14% over the previous year. The growth in insured deposits reflects changes to deposit insurance which extended coverage to include eligible deposits held in foreign currency and eligible deposits with terms greater than five years. It also reflects the impact of the COVID-19 pandemic that saw an increased level of savings by Canadians.

CDIC’s 2021 Annual Report highlights progress made against key strategic priorities, including:

1. Refining CDIC’s capability to respond quickly and effectively to member institution failures
   CDIC enhanced its resolution readiness through a well-defined risk tolerance framework that ensures CDIC’s activities are commensurate with each member’s risk profile. CDIC also continued to strengthen its capacity to manage multiple member failures through crisis modelling and simulation exercises. CDIC conducted nine simulation exercises, more than twice the target number for 2020/2021, and included varying levels of participation amongst CDIC employees, Board members and financial safety net partners. Resolution planning activities were advanced as CDIC provided guidance and feedback to members on their own resolution plans to ensure they are sufficiently prepared should they run into difficulty. And, with additional changes to deposit insurance slated for April 2022, CDIC worked extensively with key stakeholder groups to ensure a smooth transition towards the new coverage framework.
2. Modernizing CDIC’s payout systems and enhancing information security practices
   Since launching the payout modernization program in 2020, CDIC has invested significant resources to modernize CDIC’s payout capabilities and related processes to protect depositors and facilitate access to insured deposits on the day of a potential failure. Key achievements include strategic design details being defined, the selection of a technology partner and the establishment of a Project Management Office to oversee the delivery of key milestones.
3. Transforming CDIC’s Enterprise Risk Management Program
   CDIC continued to refine its Enterprise Risk Management (ERM) Framework and integrate risk management into priority setting and decision making. This ensures that all risks are appropriately identified, assessed, managed and reported on, and supported by a corporate planning process which clearly aligns key risks and strategic initiatives.
4. Implementing the Organization and Culture Strategy and Plan
   CDIC completed year two of its multi-year Organization and Culture Strategy and Plan including modernizing tools to support a virtual work environment. In response to COVID-19, mental health and employee well-being took centre stage to ensure staff were supported and provided with flexibility to manage the blending of work and home life. These activities, in turn, allowed CDIC staff to better serve Canadians.
5. Increasing public awareness of CDIC deposit protection
   To bolster Canadians’ confidence and trust in the safety and security of their deposits during the COVID-19 crisis, CDIC increased its public awareness activities on TV, digital and social media. Quarterly surveys showed that public confidence rebounded since the beginning of the pandemic. Awareness of CDIC’s role in protecting deposits reached 61% as of March 2021, which was within the key deliverable target range of 60%–65% this fiscal year.

The CDIC 2021 Annual Report also outlines CDIC’s financial performance over the past year.

CDIC is a federal Crown corporation established in 1967 to protect the savings of Canadians, and we contribute to financial stability by safeguarding over $1 trillion in deposits at more than 80 member institutions. As resolution authority, we are responsible for handling the failure of any of our members, from the smallest to the largest. Our members include banks, federally regulated credit unions as well as loan and trust companies. We are funded by premiums paid by member institutions and do not receive public funds to operate. We have resolved 43 member failures affecting some two million Canadians. No one has lost a dollar of deposits under CDIC protection.

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For further information

Brad Evenson
Director, Communications and Public Affairs
Tel: 613-943-4395
E-mail: media@cdic.ca

CIPF and CDIC have teamed up on a free webinar that provides an overview of how coverage works at each organization, including what is covered and the coverage limits. The webinar also highlights key updates relevant to IIROC and CIPF members, including upcoming changes to CDIC’s coverage and to the CIPF Disclosure Policy, and offers further resources to help learn more about CIPF and CDIC.

This free webinar is accredited by IIROC and you will earn one continuing educating credit upon completion.

CIPF and CDIC: Coverage and Disclosure Registration (onlinexperiences.com)

Speaking notes by Mike Mercer, CDIC’s Chief Data and Insurance Officer, to the Independent Financial Brokers of Canada Fall Summit – October 21, 2021.

CDIC’s 2021 Annual Public Meeting – October 21, 2021

Leah Anderson, President and CEO of CDIC, was joined by members of the CDIC Board of Directors and a panel of subject-matter experts for a conversation about the gender gap in financial literacy. Panelists included:

• Dr. Supriya Syal, Deputy Commissioner, Research, Policy and Education at the Financial Consumer Agency of Canada
• Jessica Moorhouse, millennial money expert and host of the More Money Podcast
• Jaime Damak, lifestyle blogger and owner of jesuisunemaman.com
• Linda Caty, CDIC Board member
• Bob Sanderson, Chair of CDIC’s Board of Directors

The panel addressed Canadian-based behavioural research into potential causes for the gender gap and discussed CDIC’s public awareness research, highlighting the significant role women play in supporting financial stability across Canada.

OTTAWA – October 21, 2021 – Canada Deposit Insurance Corporation (CDIC) held its Annual Public Meeting today via live webcast. CDIC President and CEO Leah Anderson was joined by members of the CDIC Board of Directors and a panel of subject matter experts for a conversation about the gender gap in financial literacy.

“When the COVID-19 pandemic struck, CDIC adapted quickly to the changing landscape, placing focus on initiatives that strengthened CDIC’s ability to respond effectively to uncertainty and to protect depositors under any circumstance,” said Ms. Anderson. “An integral part of protecting depositors is public awareness. Canadians can’t fully benefit from a deposit insurance program if they don’t know about it.”

CDIC research continues to show a significant gap in awareness among women as compared to men. This gave rise to more targeted efforts to address the gender gap, including through this year’s APM theme of increasing financial literacy among women.

Central to the day’s theme was research presented by the Financial Consumer Agency of Canada (FCAC)’s Dr. Supriya Syal, who discussed potential causes for the gap in awareness and financial literacy in general. To round out the discussion, CDIC heard insights from millennial money expert Jessica Moorhouse, and lifestyle blogger, Jaime Damak, who highlighted the importance of keeping women engaged in conversations about finances. The meeting concluded with panelists responding to questions from the public.

CDIC is a federal Crown corporation established in 1967 to protect the savings of Canadians, and we contribute to financial stability by safeguarding over $1 trillion in deposits at more than 80 member institutions. As resolution authority, we are responsible for handling the failure of any of our members, from the smallest to the largest. Our members include banks, federally regulated credit unions as well as loan and trust companies. We are funded by premiums paid by member institutions and do not receive public funds to operate. We have resolved 43 member failures affecting some two million Canadians. No one has lost a dollar of deposits under CDIC protection.

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Further information

Brad Evenson
Director, Communications and Public Affairs
Tel: 613.943.4395
E-mail: media@cdic.ca