- Bargaineering - http://www.bargaineering.com/articles -

FDIC and NCUA Deposit Insurance

If you have a bank account, your deposits are insured by the Federal Deposit Insurance Corporation (FDIC). If you have a credit union account, your deposits are insured by the National Credit Union Administration (NCUA). In my article on five accounts you must have (and four you should skip) [3], there was discussion in the comments about the FDIC insurance and since I never really read up on it (other than remembering the insurance for up to $250,000), I did.

Update: The Dodd-Frank Wall Street Reform and Consumer Protection Act (H.R. 4173 [4]), signed on July 21st, 2010, has made permanent the insurance limit of $250,000.

Federal Deposit Insurance Corporation (FDIC)
Most banks are going to have this insurance and you can tell that by looking for the following sign:

Now, since any sign can be copied or counterfeited (or you can’t find it), you can always look it up through the FDIC bank lookup [5].

The basic insurance covers you for $100,000 per depositor per insured bank, so having multiple accounts at a single bank will not increase the amount covered. The only way around it is if you have different accounts of different legal ownership, then those are separately counted. The legal ownership types, there are eight, are Single Accounts, Certain Retirement Accounts, Joint Accounts, Revocable Trust Accounts, Irrevocable Trust Accounts, Employee Benefit Plan Accounts, Corporation/ Partnership/ Unincorporated Association Accounts, and Government Accounts. Also, certain retirement accounts are insured up to $250,000 per owner per insured bank.

If you’re itching for more information, the FDIC has a great online pamphlet [6] explaining this all out.

National Credit Union Administration (NCUA)
If you have a credit union account, you’re also covered by a similar program offered by the National Credit Union administration and you can tell if your credit union is insured if you see:

In fact, the NCUA regulates and charters credit unions so if you don’t see that placard, then it’s not officially a credit union. To confirm that your credit union is in the NCUA system, you can use their online lookup system [7].

The rules on the limits are the same, $100,000 per depositor per insured credit union and the limit increases to $250,000 for certain retirement accounts. For more information, you can hit up the NCUA website [8].