The Money Mustache Community
Around the World => Canada Discussion => Topic started by: singpolyma on May 14, 2019, 08:17:05 PM
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For those with a larger 'stache, does anyone worry about CIPF insurance limits on account balances? It seems that most accounts are covered to $1M and joint accounts to $2M (so long as each party claims $1M). My accounts are ultimately held with a charter bank, so insolvency seems very unlikely, yet it does feel risky going over the insurance limit on an account for an extended period of time.
Any thoughts?
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CIPF does not insure your securities... only really against fraud or the minor amounts in transition during a firm's insolvency (e.g., they held cash or were making a transfer to another account for you when they because insolvent.. or had shady accounting practices and "lost" your securities or you were a victim of embezzlement / fraud)
The core securities being held in your account, in your name, are fine... it is only the cash money at the "fringes" or outright scams / fraud that are insured by CIPF.
So, yeah, I might be hesitant with holding more than $1 million in a small, new, secondary brokerage, but not with one with a large established customer base and policies.
Maybe I am naive.