FDIC INSURANCE COVERAGE

  Print Version

By Holly Fields, CPA – Senior Accountant

The FDIC (Federal Deposit Insurance Corporation) is an independent agency of the United States government which was established in 1933 to protect depositors of insured banks in the United States against the loss of their deposits if the bank fails. During the financial crisis of 2008, the FDIC extended unlimited insurance coverage to non-interest bearing checking accounts. For all other categories, the limit remained at $250,000. As of December 31, 2012, this additional guarantee expired therefore the coverage returned to the original $250,000 per depositor, per insured bank, for each account ownership category (e.g. single accounts, joint accounts, and revocable and irrevocable trust accounts).

What does FDIC insurance cover? FDIC insurance covers all types of deposits received at an insured bank, including deposits into:

• Checking accounts
• Negotiable order of withdrawal (NOW) accounts
• Savings accounts
• Money market deposit accounts (MMDA)
• Certificate of deposits (CD)

The FDIC does not insure the following:

• Money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities
• Safe deposit boxes or their contents
• U.S. Treasury bills, bonds or notes
• Deposits at credit unions

All organizations should review their accounts frequently to assess any potential risk of loss due to accounts exceeding the FDIC coverage limits.