Deposit insurance in Canada I: insures all deposits in chartered banks up to a maximum of $100,000.II: would generate incentives for more desirable outcomes if it involved a small deductible that is not covered.

Question

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I is true as the Canada Deposit Insurance Corporation (CDIC) insures all deposits in chartered banks up to a maximum of $100,000 per depositor.

II is also true as a small deductible that is not covered could generate incentives for more desirable outcomes, such as encouraging individuals to carefully consider the risks before depositing money, which could ultimately promote stability in the financial system.

Deposit Insurance in Canada I: Insures All Deposits in Chartered