Protection for eligible deposits when an insured bank or credit union fails, subject to institution, ownership, and balance limits.
Deposit insurance protects eligible deposit balances if an insured bank or credit union fails, up to the applicable limits and ownership rules. It does not insure every product sold by a financial institution or every loss involving a bank account.
$250,000 per depositor, per insured bank, for each ownership category.An insurer defines which institutions and products qualify, how accounts are grouped, and how insured balances are paid or transferred after a failure. Coverage is generally automatic for eligible deposits; the depositor does not buy a separate policy.
In the U.S. banking system, the FDIC insures deposits at FDIC-insured banks. The NCUA administers share insurance for federally insured credit unions. Other countries use different insurers, limits, currencies, and account-grouping rules.
| Commonly covered at an insured bank | Not covered by FDIC deposit insurance |
|---|---|
| Checking accounts | Stocks and bonds |
| Savings accounts | Mutual funds, including money market funds |
| Money market deposit accounts | Cryptoassets |
| Certificates of deposit and other time deposits | Annuities and life-insurance policies |
| Certain bank-issued official items | Safe-deposit-box contents |
The fact that an uncovered product is sold at a bank does not turn it into an insured deposit.
Assume Jordan owns, in Jordan’s name alone, a checking account with $125,000 and a CD with $175,000 at the same FDIC-insured bank. In this simplified example, both balances are in the single-account ownership category and total $300,000.
Under the standard $250,000 limit, $250,000 would be insured and $50,000 would be above the limit. Moving the CD to another branch of the same bank would not create separate coverage because branches are not separately chartered banks.
Different ownership categories or a separately insured bank can change the calculation. Trust, retirement, joint, business, and government accounts have their own requirements, so simplified examples should not replace the insurer’s calculator or guidance.
An uninsured certificate of deposit is not necessarily a separate CD product. The phrase usually describes all or part of a CD balance that falls outside the applicable deposit-protection rules.
For example, a valid CD at an FDIC-insured bank can be partly insured and partly uninsured after the depositor’s balances in the same ownership category are aggregated. A CD can also be uninsured because the issuer is not an insured bank or because the instrument is not an eligible deposit. Determine the status from the legal issuer, ownership records, product type, and total balances rather than from marketing labels.
An uninsured amount is exposed to the failed institution’s receivership process. Recovery and timing are not guaranteed merely because the claim arose from a CD.
Coverage is not simply $250,000 per account number. The analysis usually requires:
Trade names, online divisions, and branches can belong to the same chartered bank. Verify the institution rather than assuming that different branding means different coverage.
Deposit insurance protects depositors and supports confidence in the banking system. It can reduce incentives for insured depositors to join a bank run, but it does not eliminate liquidity risk, uninsured depositor exposure, or the need for bank supervision and resolution planning.
This article provides general education. Deposit-coverage conclusions can depend on detailed ownership and account records; consult the applicable insurer or a qualified adviser for a specific situation.