Your 2025 Guide to CDIC Insurance

Most Canadians assume that the money sitting in their bank account is safe, but few actually understand why. This security doesn’t just happen by chance, it’s courtesy of the Canadian Deposit Insurance Corporation (CDIC), which can protect depositors in the event of a bank failure.

This organization plays a critical role in maintaining confidence in Canada’s banking system. Today, the corporation covers over $1 trillion in deposits at over 80 member institutions.

In this article, we’ll explain how CDIC insurance safeguards your savings, what it covers, and how to know if your money qualifies for coverage.

What Is CDIC Insurance?

Created in 1967, the Canadian Deposit Insurance Corporation (CDIC) is a federal crown corporation tasked with the responsibility of protecting eligible deposits at member banks. As outlined in the Canadian Deposit Insurance Corporation Act, the corporation acts as a financial safety net and can step in during the unlikely event that a financial institution fails.

If you bank with a member institution, you will automatically receive CDIC coverage at no cost. The catch? Deposits are only eligible for up to $100,000 in coverage per insured category, per bank and only certain assets have this protection.

How CDIC Insurance Works

CDIC protection activates only when a member institution fails. When this occurs, the system works quickly to restore public confidence.

Initially, the process begins when the Office of the Superintendent of Financial Institutions (OSFI) determines that a bank is no longer viable. Then, the CDIC steps in as the official resolution authority.

The CDIC may then arrange a transfer of the deposits to another institution or bank. Or they can make a payment directly to the depositor. No matter the path, the corporation ensures that depositors with eligible funds get access to their money as soon as possible. Often, that happens within a few days.

What CDIC Covers

While there are clear benefits to CDIC insurance, it’s essential to recognize that coverage is limited to certain assets, meaning it doesn’t apply to everything you own at the bank. Thankfully, CDIC insurance does cover some of the most important parts of your finances, like your everyday deposits and your savings.

Eligible assets also include chequing and savings accounts, term deposits, and GICs, plus money orders and bank drafts. As long as they remain at CDIC member institutions, that is.

Each depositor has coverage of up to $100,000 per category, per institution. This means that your coverage isn’t limited to a single account. Instead, it applies separately across the following categories:

• Individual account
• Joint account
• Trust account
• Registered Retirement Savings Plan (RRSP)
• Registered Retirement Income Fund (RRIF)
• Tax-Free Savings Account (TFSA)
• Registered Disability Savings Plan (RDSP)
• Registered Education Savings Plan (RESP)
• First Home Savings Account (FHSA)

As an example of how CDIC coverage works, you could have $100,000 in a chequing account, another $100,000 in a TFSA, and an additional $100,000 in an RRSP, and be completely covered. Want to extend this coverage even further? No problem! Just spread your funds across multiple CDIC member institutions up to the limit of $100,000 per insured category.

Tip: You don’t have to keep your savings in Canadian dollars in order to qualify for coverage. The CDIC covers both CAD and foreign currency deposits.

What The CDIC Does Not Cover

While the CDIC has many categories of coverage, not everything is protected. The following assets are excluded from CDIC coverage:

• Stocks and Exchange Traded Funds (Canadian, US and global)
• Bonds
• Mutual funds
• Cryptocurrencies and other digital assets

CDIC coverage doesn’t apply to institutions that are not members. This includes many credit unions which are provincially registered and instead have coverage from provincial insurance.

Checking If Your Bank Has CDIC Protection

Not every financial institution in Canada has protection from the CDIC, but most major banks and many online ones do. To ensure your money is safe, it’s smart to confirm if your bank is a CDIC member before you deposit large sums of money.

There are two ways to check. First, you can look on your bank’s website, mobile application or monthly statements. If there is a CDIC logo there, then you should be good to go. But, if you’re still not sure, you can check the official member institution list on the CDIC website to confirm.

Maximizing Your CDIC Protection

Even with deposit insurance, how you manage your accounts can make a big difference. Taking advantage of CDIC protection isn’t complicated, but it does require a bit of strategy.

To get the maximum possible coverage for your money, begin by diversifying your deposits. CDIC coverage applies across each category and member institution. This means that by spreading out your savings, you may qualify for additional protection. For example, if you have $200,000 in a chequing account, you can split it up with $100,000 at two separate financial institutions or with that same limit on two different account types. Consider a chequing account and a Tax Free Savings Account (TFSA), for instance. In this case, you would then have coverage on the full $200,000, rather than just on the first $100,000.

In addition to spreading out your deposits across different banks, you can also have different account holders. For example, you can divide your money between personal accounts and joint accounts, rather than keeping it all in one and receiving minimal coverage.

Finally, always double-check that your bank is on the CDIC’s official list of member institutions. Consider doing this before you decide to deposit money. If the institution does not appear on the list, then remember that your money will not get protection from the corporation.

Takeaway

The Canadian Deposit Insurance Corporation is one of the key reasons why Canadians place their trust in the banking system. Protecting eligible deposits and stepping in should a bank fail, the CDIC helps prevent panic and keeps the financial system stable.

While CDIC coverage is important, you also need to take a proactive role in ensuring your own financial protection. Confirm your bank’s CDIC membership and be sure to stay within the limits to its coverage by diversifying your deposits.