Insurance and virtual money

Insurance and virtual money

It is only recently that virtual money or cryptocurrencies have emerged in the financial landscape. Are these new monetary values covered by standard home insurance policies?

National Bank General Insurance
27 April 2017

At the time of writing, listed 1570 different virtual currencies (cryptocurrency) with a total capitalization of more than 342 billion dollars. Not a day goes by that newspapers aren’t talking about it… often in the negative. Every day, stories abound about money being stolen or lost. Many are wondering: are these losses covered by insurance?


Cryptocurrency is virtual money, created by cryptographic algorithms with the admitted goal of existing on the fringes of traditional banking and monetary exchange systems, in order to operate independently of them. Unfortunately, existing on the margins of the traditional system also means not being covered by its protection mechanisms, as we were reminded by the Autorité des marchés financiers.

It’s a highly volatile form of currency, with the potential to plummet dramatically because of a simple software bug. Imagine if the dollar lost 60% of its value in 24 hours?

In spite of all this, the public’s interest has remained unflagging over the months. Just the opposite, in fact – more and more people are trying their luck with it. Bitcoin ATMs even opened in Montreal recently!

What’s covered

Goods – even virtual ones – are covered by home insurance, whether you’re a homeowner, co-owner, or tenant. Theft is included in most insurance policies, but generally unexplained losses are only covered by All-perils policies. But be careful: just because you’re covered for theft or loss, doesn’t mean there aren’t limitations.

The reference contract

The Insurance Bureau of Canada (IBC) suggests basic formulas for home insurance. In a Homeowner’s comprehensive policy (1503), you’ll find the following listed under the Special Limits of Insurance:


  1. For any one loss caused by an insured peril:

    a. Money, including cash cards and plastic money, bank notes, bullion or gift certificates up to $200

Covered or not covered?

Is it covered? Yes, but the loss is typically limited to $200 depending on the insurer. And it is neither covered by the financial services compensation fund nor by the deposit insurance fund. Unfortunately, there is no recourse if you lose the hard drive that contained your virtual money or have your virtual wallet stolen.

You have questions about the limits specified in your insurance policy? Contact one of our damage insurance advisors.


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