Budget 2026 proposes 1st deposit insurance limit increase in 2 decades
The CDIC limit is moving from $100,000 to $250,000 under the federal budget, an increase many have urged for years to protect consumers.
The Canadian federal government has unveiled plans to raise the deposit insurance limit under the Canada Deposit Insurance Corporation (CDIC) for the first time in over two decades. This proposal, featured in the 2026 budget, aims to "modernize the deposit insurance framework." The Canadian Deposit and Insurance Corporation (CDIC) limit currently stands at $250,000, protecting consumers in the event of a bank failure.
The CDIC limit refers to the maximum amount of a consumer's deposits that are safeguarded if a bank were to fail. In 2023, the Bank and Trust Companies Association sent a letter to former Finance Minister Chrystia Freeland, urging CDIC to double its coverage to $200,000 per depositor. Canada currently provides the lowest level of deposit insurance among G7 nations, according to a letter from the group.
A significant portion of deposits at Canada's largest banks remain uninsured. Approximately 65% of deposits at the country's top six banks - Royal Bank of Canada, TD Bank, Bank of Montreal, CIBC, Scotiabank, and National Bank of Canada - are not covered under CDIC. In 2025, the Department of Finance announced it would review the deposit insurance limit, with plans to adjust it to $150,000 to maintain its "real value" in the face of inflation, a figure set in 2005.
The proposed increase to $250,000 per deposit category would align Canada's deposit insurance with that of the United States and certain Canadian provinces, potentially offering better protection for non-retail depositors. As part of the 2026 budget, the government intends to legislate a periodic review of the deposit insurance framework every ten years, ensuring the CDIC can access data for evidence-based policy development.
Additionally, the framework would allow provincial trust and loan companies to become CDIC members by remaining federal trust and loan companies.
The CDIC has 85 members as of the 2025 annual report. To accommodate life events such as selling a home, the government also plans to provide a temporary high balance for certain eligible deposits. This deposit insurance limit is excluded from the proposed changes.
Written by urgent.news from Global News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
