CIPF (Canadian Investor Protection Fund)

The Canadian Investor Protection Fund, or CIPF, protects your investments if your brokerage firm becomes insolvent. It covers up to $1 million per account category, which includes the value of cash, stocks, ETFs, bonds, and other securities held in your account.

What it covers

If your brokerage goes bankrupt and your assets go missing, CIPF steps in to make you whole, up to the coverage limit. This applies to most types of investment accounts, including non-registered accounts, TFSAs, and RRSPs. Each account category has its own $1 million limit.

CIPF covers the property that should be in your account but isn’t, due to the firm’s insolvency. It doesn’t cover investment losses from market declines. If your stocks dropped in value, that’s not what CIPF is for.

How it differs from CDIC

CDIC protects bank deposits (savings accounts, GICs). CIPF protects investment accounts at brokerages. They cover different things at different types of institutions.

If you have a savings account at a bank, CDIC has you covered. If you have a brokerage account where you hold stocks and ETFs, CIPF is the relevant protection.

Do you need to sign up?

No. If your brokerage is a member of the Canadian Investment Regulatory Organization (CIRO), you’re automatically covered by CIPF. All major Canadian online brokerages, including Wealthsimple, Questrade, and the bank-owned brokerages, are members. You can verify your brokerage’s membership on the CIPF website.

Example

Say you hold $300,000 in your TFSA and $500,000 in a non-registered account at the same brokerage. If that brokerage were to become insolvent, your TFSA would be covered up to $1 million and your non-registered account up to $1 million separately. In this case, the full $800,000 across both accounts would be protected. CIPF covers the assets that should be in your account but went missing due to insolvency. It would not cover you if your stocks simply dropped in value.