What is CDIC insurance, how it works and what’s covered

0
20


CDIC Members

To qualify for any coverage, your financial institution needs to be a CDIC member. There are 86 member banks total including the Big Five banks—BMO, CIBC, RBC, Scotiabank and TD—along with online-only financial services like EQ Bank and Alterna Bank. To find out which financial institutions are covered, you can scroll through the complete list; in addition, members always display the CDIC badge at their branches, and on their websites and apps.


CDIC Savings Accounts

EQ Savings Plus Account

  • Minimum balance: None
  • Free transactions per month: Unlimited
  • Fee for Interac e-Transfers: Free
  • Promotional Rate: None
  • Interest Rate: 1.50%

Alterna Bank High-Interest eSavings Account

  • Minimum balance: None
  • Free transactions per month: Unlimited
  • Fee for Interac e-Transfers: Free
  • Promotional Rate: None
  • Interest Rate: 1.20%

Tangerine Savings Account

  • Minimum balance: None
  • Free transactions per month: Unlimited
  • Fee for Interac e-Transfers: Free
  • Promotional Rate: 2.15% for opening your first Tangerine account. Plus, you could earn $200 when you add payroll
  • Interest Rate: 0.15%

CDIC insurance deposit categories

Like any insurance coverage, the CDIC has its maximum payout limits. In the event your member financial provider closes, they will insure up to $100,000 in deposits in each of the following seven categories:

  1. Deposits held in one name: Personal chequing, savings and GICs accounts
  2. Deposits held in more than one name: Joint chequing, savings accounts and GICs
  3. Deposits held in an RRSP: RRSP savings accounts and GICs
  4. Deposits held in a TFSA: TFSA savings accounts and GICs
  5. Deposits held in an RRIF: RRIF savings accounts and GICs
  6. Deposits held in a trust
  7. Deposits held for paying taxes on mortgaged properties

These CDIC categories dictate their inner workings and how they deliver their benefits in the event that you need them.

How CDIC insurance works—with examples

For every one category that you have savings in, you will receive $100,000 of coverage. Sounds simple enough, right? Keep reading to get the full details that allow you to protect more of your money.

How CDIC insurance works when your money is deposited at one bank

When it comes to insurance coverage, your deposits are divided up according to the seven categories defined by the CDIC, and not the accounts you are holding them in.

For example, if you have $100,000 in a savings account and $100,000 in a chequing account, you will receive a total of $100,000 worth of coverage because they are in the same category called “deposits held in one name.”

However, if you have $100,000 in a savings account and a $100,000 deposit held in a TFSA savings account, you will receive a total of $200,000 worth of coverage because your money is stashed in two different CDIC categories—“deposits held in one name” and “deposits held in a TFSA” respectively ($100,000 worth of coverage per category). If you also have a $100,000 deposit held in an RRSP, you will receive a total of $300,000 of coverage because you have savings in three different categories ($100,000 worth of coverage per category). 

How CDIC insurance works when your money is deposited at several banks

The $100,000 maximum coverage per category is also per bank, because each member organization pays premiums to make this insurance available to you. To put this in dollars and sense, when you have $100,000 in a savings account at one bank, and $100,00 in a savings account at another bank, you will receive $200,000 worth of coverage ($100,000 worth of coverage per bank).  



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here