HOW TO AFFORD MAXIMUM INSURANCE COVER ON YOUR DEPOSITS WITH BANKS
People keep money with banks for different purposes. Some may keep it for meeting marriage expenses, others for old age, children's education and the like. A number of reasons may be there. As people want more interest foregoing the security of capital, money is kept with banks, fixed deposits with companies. Sometimes by offering more interest, the public is lured to keep deposits with banks of poor growth record or in dubious companies. Hundreds of thousands of people have been cheated by these dubious companies/
Now as far as deposits in banks are concerned it may take various nature like fixed, current and saving and recurring deposits. Sometimes people maintain accounts with different branches too. The deposits kept in the banks including commercial , cooperative and RRBs and LABs are insured by DICGC a wholly owned subsidiary of RBI. The payment on these deposits are paid by the bank and this cannot be passed on to the deposit holders.
The deposits held by an individual in the same right and capacity is insured to the extent of Rs.1 lakh. Now what is the meaning of deposits held in the same right and capacity – which means that deposits held by an individual in multiple branches of the same bank and different types of accounts are insured to the maximum of Rs 1 lash though his deposits are more. But deposits held by an individual in different capacities as partner or sole proprietor is consodered as different accounts Clarifications would be issued through this forum in case of doubts, if any, or if the concept is not clear with examples.
Likewise if X is having an account with his wife where his name appears as the first one in the first account and as second one in the second account Then it is treated as two different account enjoying the full insurance cover of Rs 1 lakh in both accounts. However if his name is appearing as the first one in both the accounts, his insured bank deposits is the upper limit of Rs 1 lakh.