Objectives of the CARICOM Policy. The CARICOM Policy on Deposit Insurance promotes the introduction of a best practice deposit insurance system through either the reform of an existing deposit insurer, or the establishment of a new system in each Member State or among a group of Member States (such as the ECCU) so as to encourage market confidence and support financial stability in the Community. The main objectives of the Policy are to –
(i) Contribute to the development and stability of the financial systems within the Caribbean Community;
(ii) Provide eligible depositors within the Caribbean Community with a minimum level of protection by safeguarding their deposits against losses due to the failure of a financial institution;
(iii) Promote market confidence by strengthening the crisis management and financial stability framework in Member States through greater co-ordination among financial safety-net partners; and
(iv) Foster greater collaboration between the deposit insurer in one Member State and the counterpart in other jurisdictions, so as to reduce the possibility of contagion risk from bank failure and/or financial crises originating in any one Member State in the Community.