Ottawa Wants to Raise Your Deposit Insurance to $250,000: What Changes (and What Doesn’t)

 

For more than 20 years, the federal guarantee on your savings has been stuck at $100,000. In Thursday's budget, Ottawa proposed to raise it to $250,000. Here is what would change, what wouldn't, and why you shouldn't move a dollar yet.

Today (unchanged since 2005) $100,000 per deposit category

Proposed in Budget 2026 $250,000 per deposit category

What Budget 2026 actually proposes

The Canada Deposit Insurance Corporation (CDIC) protects your deposits if a member bank fails. The budget proposes amendments to the CDIC Act that would do four things:

• Raise the limit from $100,000 to $250,000 per deposit category, the first increase in more than two decades.
• Remove the limit entirely for eligible deposits held in registered and tax-free accounts. Today, the limit is $100,000 per account type at each institution.
• Add temporary high-balance coverage for life events such as selling a home.
• Require a review of the deposit insurance framework every 10 years.

It isn't law yet. These are budget proposals. Parliament still has to pass the legislation, and the coverage you have today is still the $100,000 limit. The budget coverage I reviewed did not give a start date, so treat the timeline as open.

Why Ottawa is moving now

The $100,000 limit has been in place since 2005. In 2023, a bank industry group told the federal finance minister that Canada had the lowest level of deposit insurance among G7 countries. At the time, DBRS Morningstar estimated that about 65 per cent of deposits at the Big Six banks were uninsured.

In 2025, the Department of Finance said inflation had eroded the real value of the 2005 limit and that $150,000 would be needed just to restore it. The budget goes well past that. Finance says $250,000 per category would line up with the United States and some provinces. Ontario's provincial coverage, for example, already mixes $250,000 limits and unlimited coverage depending on the product.

What deposit insurance covers, and what it doesn't

CDIC covers deposits: chequing and savings balances and GICs at member institutions. It does not cover stocks, mutual funds or ETFs, even if you hold them inside a TFSA or RRSP. Credit unions are generally insured by their provincial insurers, not CDIC.

That matters for the budget's "unlimited" proposal for registered accounts. It applies to eligible deposits, so a high-interest savings account or GIC inside your TFSA would benefit. The ETF in the same TFSA would not. Check the final legislation for the exact wording before you rely on it.

What it means for you

If you split cash across banks to stay under $100,000, a $250,000 limit would eventually let you consolidate. Not yet, though.

If your TFSA, RRSP or FHSA holds cash or GICs, those deposits would be fully covered under the proposal, however large the balance.

If you are about to sell a home, the temporary high-balance coverage could protect the proceeds while you decide what to do with them. The budget coverage I found does not spell out which life events qualify or for how long, so ask your bank before relying on it.

Before you move any money

Until the legislation passes, plan around $100,000 per category. Confirm that the institution actually holding your money is a CDIC member. If you use a fintech app, check which bank sits behind it. And don't let a bigger safety net be the only reason to chase a higher rate. Fees, rate guarantees and how easily you can withdraw still matter.

The deposit insurance change comes alongside other banking proposals in the budget, including a competition objective for the federal bank regulator and looser growth rules for mid-sized banks. If those pass, expect more choice at the smaller end of the market, and more reason to understand exactly what is insured.

The bottom line

Doubling and then some the federal safety net is a real win for savers, and it is the first update in more than 20 years. But it is a proposal, not a rule. Keep your accounts as they are, watch for the legislation, and check what is actually insured before assuming anything is.

This article is general information, not financial or legal advice. Check CDIC and your institution for the rules that apply to you.

Sources: Global News, Nov. 6, 2026; Advisor.ca, Nov. 5, 2026; Wealth Professional; Mortgage Professional America (Canada); The Globe and Mail.