FDIC insurance is a federal safety net that automatically protects money in checking, savings, money market, and CD accounts at insured banks, up to $250,000 per depositor, per bank, per ownership category, according to the Federal Deposit Insurance Corporation. It doesn't cover investments, safe deposit boxes, or crypto held through a bank.
What exactly does FDIC insurance cover?
FDIC insurance covers deposit accounts at member banks: checking accounts, savings accounts, money market deposit accounts, certificates of deposit, NOW accounts, and cashier's checks or other official bank items, the FDIC says in its overview of insured deposits. Coverage kicks in the moment you open an account at an FDIC-insured bank — you never apply for it or pay for it separately.
Some prepaid cards are also covered if they meet specific FDIC requirements, according to the FDIC's page on insured financial products. The rule of thumb: if the product is a deposit — money the bank owes back to you on demand or on a set date — it's the kind of thing FDIC insurance is built for.
How much of my money is protected?
The standard coverage amount is $250,000 per depositor, per insured bank, for each account ownership category, the FDIC states in its deposit insurance overview. That limit applies across all the deposit accounts you hold in the same ownership category at one bank — it isn't $250,000 per account.
If you're not sure whether your balances at a single bank add up to more than that, the FDIC's Electronic Deposit Insurance Estimator (EDIE) lets you enter your accounts and see whether everything is still fully covered, Bankrate notes in its explainer on FDIC insurance limits.
What isn't covered by FDIC insurance?
FDIC insurance doesn't extend to anything that isn't a deposit, even if you bought it through a bank. According to the FDIC, that includes:
- Stocks and bonds
- Mutual funds
- Cryptocurrency assets
- Life insurance policies and annuities
- Municipal securities
- Contents of a safe deposit box
- U.S. Treasury securities — these carry their own federal government backing, but it isn't FDIC insurance
A crypto asset held at or through a bank is not protected the same way a savings account is. Crypto is volatile, and losses on it are possible regardless of where you buy or hold it.
How do joint accounts and other ownership categories change my coverage?
Ownership category is what determines whether your coverage multiplies beyond $250,000 at one bank. A single account, a joint account, and a retirement account are each treated as separate categories, so the same person can be insured well past $250,000 total at one institution by spreading money across categories, per the FDIC.
Joint accounts get their own math: each co-owner is insured up to $250,000 in that category, separate from what they're insured for individually. Bankrate illustrates this with an example: a married couple with $500,000 in one joint savings account is fully covered, because each spouse's $250,000 share of that joint account is insured on its own.
| Ownership category | Standard coverage | Example |
|---|---|---|
| Single accounts | $250,000 per owner | One person's checking and savings accounts at the same bank are added together and insured up to $250,000 total |
| Joint accounts | $250,000 per co-owner | A two-person joint account is insured up to $500,000 combined, per the FDIC |
| Certain retirement accounts (e.g., IRAs) | $250,000 per owner | Insured separately from that same person's single accounts at the bank |
| Revocable trust accounts | Coverage tied to the number of eligible beneficiaries, up to set FDIC limits | As of April 1, 2024, trust accounts with five or more beneficiaries are capped at $1,250,000 per owner across trust accounts at that bank, per the FDIC |
Are credit unions protected the same way?
Yes, through a parallel federal program. The National Credit Union Administration's Share Insurance Fund protects deposits — called "shares" at credit unions — up to $250,000 per member-owner, per federally insured credit union, per ownership category, according to the NCUA. Single, joint, and IRA or Keogh retirement accounts are each covered up to $250,000 separately, the same structure the FDIC uses for banks.
The NCUA describes its fund as backed by the full faith and credit of the United States, the same government backing behind FDIC insurance. The agency also notes that no member of a federally insured credit union has ever lost a cent of insured deposits.
What happens if my bank fails?
If an FDIC-insured bank fails, the FDIC pays out insured deposits either by moving your account to the bank that acquired the failed one or by issuing a check, typically within a few days, according to Bankrate's overview of how FDIC insurance works. You don't need to file a claim to get money that's within the insured limit — the payout process is automatic for covered deposits.
Money above the insured limit in a given ownership category isn't automatically lost, but it isn't guaranteed either; it becomes a claim against the failed bank's remaining assets. That's the practical reason to check your coverage before a balance grows past $250,000 in one category at one bank, rather than after.
How can I check if my bank is FDIC-insured?
Most banks display the FDIC's official sign at branches and on their websites, but you can confirm directly using the FDIC's BankFind Suite, a search tool where you look up an institution by name to verify its insured status, Bankrate notes. Credit unions carry the equivalent NCUA insured symbol, and the NCUA's own site lets you confirm a credit union's federal coverage the same way.
Checking takes a few minutes and costs nothing. It's a reasonable step any time you're opening a new account, moving a large balance, or consolidating savings at one bank.
For a related business news perspective, read What FDIC deposit insurance covers, and how to protect more than $250,000 at one bank.
For more context, read How to build an emergency fund on a tight budget.
