Effective July 1, the insurance coverage on each account in a bank will be doubled, moving from $300,000 to $600,000.

This was announced in Parliament on Thursday by Dr. Omar Davies, Minister of Finance.

Dr. Davies, opening the 2007/2008 Budget Debate, declared that the Jamaica Deposit Insurance Corporation (JDIC), established after the financial sector collapse of the 1990s, had met the objectives set out at the beginning. Now, he said, was time to increase the level of protection given to depositors.

The JDIC was established in response to the financial sector crisis which saw thousands of small depositors facing ruin. This was largely averted only by the intervention of the state which repaid them their deposits.

That controversial decision is still a matter of some debate, but continues to be stoutly defended by the Government.

Whatever the merits of the decision to bail out the depositors on that occasion, it convinced the administration that a deposit insurance scheme had to be introduced to protect future depositors within the banking system.