For the purpose of Deposit Insurance entitlement business accounts are accounts held by a limited liability company (including a registered charitable organization or club), a sole trader/sole proprietorship and partnership.
Limited Liability Company Account
Example 1:
Crown Supplies Limited maintains two current accounts (payroll and operations) at ABC Bank. The payroll account (Account A) has a balance of $900,000, while the operating account (Account B) has a balance of $500,000.
The following would apply in a payout:
| Deposit Insurance Computation | ||||
|---|---|---|---|---|
| Depositor | Account | Total Deposits | Insured Deposits | Uninsured Deposits |
| Crown Supplies Limited | A & B | $1,400,000 | $1,400,000 | $200,000 |
Example 2:
Crown Supplies Limited maintains a current account (Account A) with a balance of $1,500,000 at ABC Bank. The shareholders of the business, John Brown and Winston Frederick, as well as the Chief Executive Officer Susan Simms maintain their own individual accounts at the same bank:
- John Brown – $1,000,000 (Account B)
- Winston Frederick – $900,000 (Account C)
- Susan Simms – $500,000 (Account D)
The following would apply in a payout:
| Deposit Insurance Computation | ||||
|---|---|---|---|---|
| Depositor | Account | Total Deposits | Insured Deposits | Uninsured Deposits |
| Crown Supplies Limited | A | $1,500,000 | $1,200,000 | $300,000 |
| John Brown | B | $1,000,000 | $1,000,000 | $0 |
| Winston Frederick | C | $900,000 | $900,000 | $0 |
| Susan Simms | D | $500,000 | $500,000 | $0 |
Sole Trader/Sole Proprietorship Accounts
Business accounts owned by a sole trader/sole proprietor are added together and covered separately from any other accounts of the owner. Personal funds of the owner are insured separately according to the ownership category in which they are held. The titles of these accounts usually include the name of the owner, for example, “Susan Ming as a sole trader registered her business as Susan Ming Supplies” or “John Brown registered as JB Auto Parts”. Notably, these titles do not include an indication of incorporation (e.g. ABC Limited).
Example 1:
Susan Ming maintains two accounts for her business in name of Susan Ming Supplies. These accounts include a savings account with a balance of $300,000 (Account A) and a certificate of deposit with a balance of $1,000,000 (Account B).
The following would apply in a payout:
| Deposit Insurance Computation | ||||
|---|---|---|---|---|
| Depositor | Account | Total Deposits | Insured Deposits | Uninsured Deposits |
| Susan Ming registered as Susan Ming Supplies | A & B | $1,300,000 | $1,200,000 | $100,000 |
Example 2:
Susan Ming has in her name only, a certificate of deposit with a balance of $1,000,0000,000 (Account A) and an account for her business; Susan Ming as Susan Ming Supplies (Account B), with a balance of $1,300,000 at the same Policyholder.
The following would apply in a payout:
| Deposit Insurance Computation | ||||
|---|---|---|---|---|
| Depositor | Account | Total Deposits | Insured Deposits | Uninsured Deposits |
| Susan Ming | A | $1,000,000 | $1,000,000 | $0 |
| Susan Ming registered as Susan Ming Supplies | B | $1,300,000 | $1,300,000 | $100,000 |
Partnership Accounts
Business accounts owned by a partnership are added together and covered separately from any other accounts of the owners. Personal funds of the owners are insured separately according to the ownership category in which they are held.
Example 1:
Brown & Frederick Pastries, a partnership, maintains two accounts at ABC Bank. These accounts include a savings account with a balance of $1,150,000 (Account A) and a certificate of deposit with a balance of $600,000 (Account B).
The following would apply in a payout:
| Deposit Insurance Computation | ||||
|---|---|---|---|---|
| Depositor | Account | Total Deposits | Insured Deposits | Uninsured Deposits |
| Brown & Frederick Pastries | A & B | $1,750,000 | $1,200,000 | $550,000 |
Example 2:
Brown & Frederick Pastries, a partnership, maintains a current account (Account A) with a balance of $1,750,000at ABC Bank. The partners of the business, John Brown and Winston Frederick also maintain their own individual deposit accounts at the same institution. John Brown has a certificate of deposit (Account B) with a balance of $1,300,000, while Winston Frederick holds a certificate of deposit (Account C) with a balance of $800,000.
The following would apply in a payout:
| Deposit Insurance Computation | ||||
|---|---|---|---|---|
| Depositor | Account | Total Deposits | Insured Deposits | Uninsured Deposits |
| Brown & Frederick | A | $1,750,000 | $1,200,000 | $550,000 |
| John Brown | B | $1,300,000 | $1,200,000 | $100,000 |
| Winston Frederick | A | $800,000 | $800,000 | $0 |
