Understanding deposit insurance

Have you ever wondered what would happen to your money if your financial institution failed?

In Canada, there's a deposit insurance system financed by the institutions themselves. Deposit insurance protects your savings if your financial institution goes bankrupt.

If your financial institution has a federal charter (most banks do), it's likely a member of the Canada Deposit Insurance Corporation.

The Autorité des marchés financiers (AMF) is the body mandated by the Quebec government to regulate Quebec's financial markets and assist consumers of financial products and services.

  • For every authorized deposit institution, the AMF protects your insurable deposits up to CAN$100,000 per person, per deposit category.
  • The Federation and Desjardins caisses in Quebec are deposit institutions authorized by the AMF.

What's covered and what's not
  • The most common types of insurable deposits are:
    • - Deposits in everyday accounts
    • - Deposits in savings accounts
    • - Guaranteed investment certificates (GICs) and other term deposits
    • - Market-linked guaranteed investments (MLGIs)
  • The most common types of deposits that aren't insured are:
    • - Shares
    • - Bonds
    • - Mutual investment funds
    • - Exchange-traded funds

    Insurable deposits, in Canadian dollars or foreign currencies, are protected up to CAN$100,000 in each of the following categories:

    • - Non-registered accounts (everyday accounts, savings accounts, term deposits and GICs)
    • - Registered retirement savings plans (RRSPs), including deposits in locked-in retirement accounts (LIRAs)
    • - Tax-free savings accounts (TFSAs)
    • - First home savings accounts (FHSAs)
    • - Registered education savings plans (RESPs)
    • - Registered disability savings plans (RDSPs)
    • - Registered retirement income funds (RRIFs), including deposits in life income funds (LIFs)
    • - Joint accounts you hold with a particular person or group of persons
    • - Trust accounts or accounts administered for others (every beneficiary is insured for up to CAN$100,000)

Elsewhere in Canada

The Canada Deposit Insurance Corporation and provincial deposit insurance agencies generally apply the same rules as the AMF.

Securities protected by the Canadian Investor Protection Fund (CIPF)

As mentioned above, only eligible deposits are insured. Your shares, bonds and treasury bills held in a financial institution are not guaranteed by deposit insurance.

However, the Canadian Investor Protection Fund (CIPF) protects your securities if you purchased them from an investment dealer registered with the Canadian Investment Regulatory Organization (CIRO) should they become insolvent or in cases of fraud.

The CIPF provides limited insurance of CAN$1 million for individuals for all general accounts combined. Registered retirement funds and registered education savings plans are guaranteed separately in the same amount.

The limit on CIPF protection for corporations, partnerships and unincorporated organizations is generally CAN$1 million for all accounts combined (certain exceptions apply).