Understanding FDIC Insurance

Author:  Lisa McCallister

Occasionally I have customers ask me if their accounts are insured in case of a loss.  The answer is yes.  They are covered by the Federal Deposit Insurance Corporation (FDIC) up to a certain amount for certain types of deposit accounts. 

The amount of coverage used to be $100,000 per ownership category.  On October 3, 2008, the FDIC raised the insurance coverage to $250,000 per ownership category. 

Not every type of deposit account is covered by FDIC insurance.  Some of the deposit products that are covered are checking and savings accounts, money market deposit accounts and certificates of deposits.  Examples of investment products that are not covered by FDIC insurance are mutual funds, annuities, life insurance policies and stocks and bonds.    

FDIC covered deposits held in different ownership categories are separately insured, up to at least $250,000, even if held at the same bank.  Some examples of ownership categories include single accounts, joint accounts, trust accounts, business accounts, and certain retirement accounts.  For example, a joint account is an account owned by two or more people.  If a joint account was owned by two people that didn’t have any other joint accounts at that same bank, each co-owner would be covered for $250,000 so the total coverage for the joint account would be $500,000.         

FDIC has a very helpful on-line calculator to help you figure out if you are covered for all of your accounts.  To use that tool, go to www.fdic.gov/edie

If you have any questions about FDIC insurance, do not hesitate to contact me or stop by one of our banking centers.  We will be happy to help you!