A federal Crown Corporation providing deposit insurance against loss (up to $100,000 per depositor) when a member institution fails.
What is the Canadian Deposit Insurance Corporation (CDIC)?
The Canadian Deposit Insurance Corporation (CDIC) is a federal crown corporation in Canada that provides deposit insurance to depositors in case of the failure of a member financial institution. The CDIC was established in 1967 to help protect depositors and promote stability and public confidence in Canada’s financial system.
CDIC insures eligible deposits held at its member institutions, which include banks, trust companies, and loan companies. Eligible deposits include chequing and savings accounts, term deposits with original terms to maturity of 5 years or less, and money orders and bank drafts.
In the event of a member institution’s failure, CDIC steps in to protect depositors by either returning their insured deposits or transferring the deposits to a new financial institution. This process is designed to be quick and seamless, and depositors usually have access to their insured funds within a few days of a failure.
CDIC is funded by premiums paid by its member institutions, and it operates at arm’s length from the Government of Canada. The CDIC’s deposit insurance is backed by the Government of Canada, and it is one of the strongest deposit insurance systems in the world.
Deposit insurance is an important tool for promoting stability and public confidence in the financial system, and CDIC helps ensure that depositors have a safety net in the event of a financial institution’s failure. It is important for depositors to understand their coverage under CDIC and to regularly review their deposit insurance status to ensure that their deposits are eligible for insurance.
