You have an investment account with a brokerage firm that is CIPF insured. The account consists of $40,000 in cash, and $170,000 in securities. Which one of the following is true regarding this account?
A) Only $100,000 of the account is insured against fraud
B) The $40,000 of cash and $60,000 of the securities are insured against losses from any source
C) The entire account is guaranteed safe by the Canadian government agency issuing the CIPF insurance
D) The $40,000 in cash plus the first $100,000 in securities is guaranteed by the private insurance fund backing the CIPF insurance
E) The entire account is protected by a private fund but only for losses resulting from fraud or other failure of the brokerage firm

Question

Quizplus · Accepted Answer

CIPF insurance only protects against losses from fraud or the failure of a brokerage firm. Therefore, the entire account is protected by a private fund, but only for losses resulting from fraud or other failure of the brokerage firm. The amount of coverage provided will depend on the specific circumstances of the failure or fraud.

You Have an Investment Account with a Brokerage Firm That