Is My Money FDIC-Insured?

July 19, 2023 3 mins

The Federal Deposit Insurance Corporation (FDIC) is an independent government agency that insures deposits at banks. Like the National Credit Union Administration (NCUA), it provides coverage of up to $250,000 per depositor, per insured financial institution. If you have a bank account with an American bank, your deposits are automatically insured by the FDIC.

Are credit unions FDIC-insured?

No, credit unions are not FDIC-insured, but credit union accounts are protected. Credit unions like Patelco are regulated by the National Credit Union Administration (NCUA), which is also responsible for insuring deposits and protecting members of credit unions.

The NCUA is an independent federal agency that oversees the National Credit Union Share Insurance Fund (NCUSIF). It provides up to $250,000 of federal share insurance to account holders in most credit unions, backed by the full faith and credit of the United States.

All Patelco Credit Union members accounts are insured by NCUA, up to $250,000 per depositor per account.

What is FDIC insurance?

FDIC deposit insurance protects bank customers in the event that a banking institution fails. It’s different than the NCUSIF, which protects credit union members in a similar way.

FDIC insurance automatically covers up to $250,000 per depositor, per insured bank. It’s calculated dollar-for-dollar, principal plus any interest accrued, through the date of the default. For example, if you have a CD account in your name alone with a principal balance of $150,000 and $2,700 in accrued interest, $152,700 would be insured.

FDIC coverage is calculated dollar-for-dollar, principal plus interest accrued, up to $250,000 per account.”

What types of accounts are covered by NCUA insurance?

FDIC-insured banks are backed by the full faith and credit of the United States government.

FDIC deposit insurance covers the following types of accounts, up to $250,000 per owner per account:

  • Checking accounts
  • Savings accounts
  • Money Market deposit accounts (MMDAs)
  • Time deposits such as certificates of deposit (CDs)
  • Negotiable Order of Withdrawal (NOW) accounts
  • Cashier’s checks, money orders, and other bank-issued items

Certain individual retirement accounts (IRAs); joint accounts; trust accounts; employee benefits accounts; corporation, partnership and unincorporated association accounts; and government accounts are also covered.

The FDIC does not cover:

  • Credit union accounts (which are covered by NCUA insurance)
  • Mutual funds
  • Stock investments
  • Bond investments
  • Crypto assets
  • Life insurance policies
  • Annuities
  • Municipal securities
  • Safe deposit boxes or their contents
  • US Treasury bills, bonds or notes

How does FDIC insurance work?

You don’t need to apply for FDIC insurance; your deposits are automatically insured if they’re held in an FDIC-insured bank. (Credit unions like Patelco are insured by the National Credit Union Administration.)

The standard insurance amount is $250,000 per insured bank, for each account. You may qualify for coverage over $250,000 if you distribute your funds across different types of accounts and all FDIC requirements are met — in other words, if you hold $200,000 in a CD account and $100,000 in a money market account at the same FDIC-insured bank, your $300,000 is protected.

If you have a joint account — for example, if you’re married and share a savings account — both account owners are covered by FDIC insurance, up to $250,000 per account holder.

What if my bank fails?

A bank failure happens when a bank is unable to meet its obligations to depositors and a federal or state banking regulatory agency closes the bank. Bank failures are uncommon, but when an FDIC-insured bank fails, the FDIC acts quickly to ensure account owners get access to their insured deposits.

The FDIC will act as the “insurer” of the failed bank’s deposits, paying account owners up to the insurance limit, as well as the “receiver” of the failed bank, meaning they will sell and collect assets and settle its debts, including claims for deposits that are greater than the insured limit.

Is my bank insured by the FDIC?

You can check your bank’s website or check the FDIC website, which has a searchable database of all FDIC-insured banks.

Patelco Credit Union is insured by the National Credit Union Administration, which offers similar insurance on members’ deposit accounts.

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