“I am surprised by the absence of indexation of the insurable amount ($100,000) by both the Canada Deposit Insurance Corporation (SADC) and the Financial Markets Authority (AMF). It seems to me that it has been at least 40 years, if not more, since governments have changed this amount. It’s about time it was increased. How come this amount seems immutable? » – Marc Duval
We are already looking into this issue since the Trudeau government announced, in its most recent budget, tabled last April, a review of the deposit insurance framework. It remains to be seen what the Ministry of Finance, which is the one that decides on the changes to be made, will decide. However, no timeline was provided by Ottawa. The process must be the subject of public consultations, which have not yet started.
For its part, the SADC – a federal Crown corporation which protects everything that is considered an insurable deposit – has been looking at its own deposit insurance framework since February 2023. Still in progress, the study is divided into three components: the behavior of depositors, the scope of protections, “including the deposit insurance ceiling”, as well as public awareness.
“We will gladly contribute to this review [du gouvernement fédéral], explains SADC spokesperson Mathieu Larocque. The findings of our own study will feed into the review led by the Department of Finance. »
There have been three indexations of the insurable amount since the creation of the federal Crown corporation in 1967. From $20,000, the ceiling rose to $60,000 in 1983 before being raised to $100,000 in 2005. This coverage has not been increased in almost two decades, but that does not mean the status quo.
“It has expanded to take into account people’s consumption habits,” says Mr. Larocque.
More specifically, the TFSA was added to the list of insurable deposits in 2009, followed by RESPs and RDSPs in 2022 as well as the CELIAPP last year. There are now nine categories of insurable deposits.
Insurable categories:
- Filing in the name of a single person
- In common (joint accounts)
- 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)
- Tax-free savings account for the purchase of a first property (CELIAPP)
- Insurable deposits held in trust
An insurable deposit (Canadian dollars and other currencies, guaranteed investment certificates or other term deposits) is protected up to $100,000 per CDIC member institution – the major Canadian banks are – and per category. For Desjardins Group, a cooperative financial group, it is the Financial Markets Authority (AMF) which protects insurable deposits ($100,000).
For a saver, it is possible to deposit up to $100,000 in each of the insurable categories, explains the SADC. The latter can repeat the same process in other member institutions. On its website, the SADC also offers an online calculator that can help savers determine their level of coverage.
Consult the SADC calculator
Quebec has always harmonized its own framework with the federal protection regime. For about a year, the AMF has also undertaken a review of its protection framework. However, “several steps remain to be taken before the protection regime is modified,” specifies Sylvain Théberge, director of media relations for the Quebec stock market policeman.
He specified that the collapse of the American bank Silicon Valley Bank as well as the fall – which preceded the rescue – of Credit Suisse in 2023 had prompted the Authority to carry out a review of its protection framework.