Credit Balances in Transit

Items in transit including wire transfers are to be treated consistent with the rules governing the finality of payments under the Clearing Payment and Settlement Act. Where such items are to be applied to a depositor’s account, the account balance as at the closure date will be adjusted, for the purpose of determining deposit insurance payments.

Draft / Managers’ Cheque

Where a Policyholder issues a draft or manager’s cheque which is linked to a deposit account and that instrument remains unpaid as at closure date, the value of the manager’s cheque is eligible for deposit insurance coverage.

Tax and Insurance (T&I) Accounts

This type of account contains monies for the purpose of tax and insurance payment on a mortgaged property on behalf of a borrower. These funds are held in a fiduciary capacity and are therefore insured in the same manner as trust/nominee accounts.

Funds that are held by Executors or Administrators of a Deceased Person’s Estate

Executors or administrators are agents that manage the assets and liabilities of the estate of a deceased person. Deposits of a deceased person whether held in his/her name or by an administrator or executor are covered under the Deposit Insurance Scheme as per the ownership category in which the deposit is held.

These deposits are covered up to the maximum coverage limit as per the respective ownership categories in which the funds are held. Deposit insurance payment is made to the estate of the deceased person when an administrator or executor has been appointed by the Courts.

Example 1:

John Brown is the owner of a certificate of deposit (Account A) with a balance of $500,000 at ABC Bank. He also owns a current account (Account B) with a balance of $800,000 for his sole trader business; John Brown T/A Brown’s Groceries. In February of 2016, John Brown died and two months after ABC Bank was closed. An administrator of his estate was subsequently appointed by the Courts. The following would apply in a payout:

Table 1: Deposit Insurance Computation
DepositorAccountTotal DepositsInsured DepositsUninsured Deposits
John BrownA$500,000$500,000
John Brown T/A Brown’s GroceriesB$800,000$800,000

Notably, these deposit insurance payments will ONLY be made to the estate of John Brown after the Courts have appointed an administrator. Deposits that are held in the name of an administrator or executor for a deceased person are covered separately from the personal funds of the administrator or executor.

Example 2:

Susan Simms is the executor of the estate of John Brown, which includes a sum of $1,100,000. Susan Simms then deposited these funds in a savings account (Account A) at XYZ Bank. She also maintains a personal account (Account B) with a balance of $400,000 at the same institution. The following would apply in a payout.

Table 2: Deposit Insurance Computation
DepositorAccountTotal DepositsInsured DepositsUninsured Deposits
Susan Simms    
For the Estate of John BrownA$1,100,000$1,100,000
Susan SimmsB$400,000$400,000