How does the closing of an institution affect interest accruing on a deposit?

Interest will be paid on an account up to the date of closure of an institution, even if the maturity date of the account is beyond the date of closure.  

What happens to cheques which are not cleared on a depositor’s account before the business of the institution is closed?

Those cheques will not be paid or charged against the account because the action by the Central Bank to suspend the operations of the institutions will cause all accounts to be frozen at the date of suspension. Such cheques will be returned and usually will be marked “drawee bank closed”, …

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What procedure does the DIC follow after an institution has been closed?

The DIC will balance the institution’s books and credit interest earned on all accounts up to the date of closure. DIC officials will determine how much is owed to each depositor. A list of all deposits will be prepared. From this list, the following will be identified for further examination: …

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If a depositor has an account in the main office of an institution and also at a branch office, are these accounts separately insured?

No. The main office and all branches are considered to be one institution. Therefore, the accounts would be added together and insured up to the $125,000 maximum. However, separately constituted subsidiaries or associated companies are recognised as distinct legal entities for deposit insurance purposes.  

Is the insurance protection increased by placing funds in two or more types of deposit accounts in the same institution?

No. Deposit insurance is not increased merely by dividing funds held in the same right and capacity among the different types of deposits available. For example, chequing and savings accounts held by the same depositor in the same right and capacity are added together and insured up to a maximum …

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How does a depositor establish an insurance claim?

Prior to any payment being made, every depositor will be required to provide original evidence of deposit ownership, such as a passbook, certificate of deposit, or the last statement (with paid cheques if applicable), and fill out an official claim form. DIC officials can assist with the filing of claims. …

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Must a claim be filed in person?

No. Those who are unable to attend in person may file claims by mail. Correspondence should be forwarded to the DIC using our official contact information.  

Who should file a claim if more than one person is authorised to draw on an account?

A claim must be filed by a person authorised to make withdrawals from the account. For example, a claim for deposit insurance on an account where either of two parties was authorised to sign for withdrawals may be made by either party. If two signatures were required to make withdrawals, …

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When must a depositor file a claim?

A depositor must file a claim for insurance on the official claim form within 12 months from the date of closure of the financial institution. Official claim forms are available from the DIC. It is advisable that claims be filed as soon as possible after the announcement of closure. Claims …

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Does deposit insurance protect the interests of creditors other than depositors of a failed institution?

No. Deposit insurance protects only depositors.