| Standard coverage limit | $250,000 per depositor, per bank, per ownership category (FDIC.gov) |
| Year FDIC was established | 1933 (Banking Act of 1933) |
| Number of banks covered | Thousands of federally and state-chartered member banks (FDIC.gov) |
| Deposit types covered | Checking, savings, money market deposit accounts, CDs (FDIC.gov) |
| Investments NOT covered | Stocks, bonds, mutual funds, annuities, crypto (FDIC.gov) |
| Credit union equivalent | NCUA insurance (same $250,000 limit) (NCUA.gov) |
What FDIC Insurance Is and How It Works
FDIC insurance is a federal guarantee that protects the money you hold in deposit accounts at member banks. If an insured bank fails, the FDIC steps in as receiver and reimburses depositors up to the coverage limit — typically within one to two business days. You do not need to file a claim or take any action; the process is automatic.
The agency does not use taxpayer dollars to fund insurance payments. Instead, banks pay premiums into the Deposit Insurance Fund, which the FDIC manages. Understanding how banks put deposits to work can clarify why this protection exists — see what banks actually do with your money for that context.
| Standard coverage limit | $250,000 per depositor, per bank, per ownership category (FDIC.gov) |
| Year FDIC was established | 1933 (Banking Act of 1933) |
| Number of banks covered | Thousands of federally and state-chartered member banks (FDIC.gov) |
| Deposit types covered | Checking, savings, money market deposit accounts, CDs (FDIC.gov) |
| Investments NOT covered | Stocks, bonds, mutual funds, annuities, crypto (FDIC.gov) |
| Credit union equivalent | NCUA insurance (same $250,000 limit) (NCUA.gov) |
What FDIC Insurance Covers
FDIC insurance covers deposit accounts held at member banks. Covered account types include:
- Checking accounts
- Savings accounts
- Money market deposit accounts (not money market mutual funds)
- Certificates of deposit (CDs)
- Cashier's checks and money orders issued by insured banks
The standard limit is $250,000 per depositor, per insured bank, per ownership category. Ownership categories — such as single accounts, joint accounts, IRAs, and certain trust accounts — are each insured separately. A married couple with a joint checking account, for example, has coverage up to $500,000 on that account alone, because each co-owner is entitled to $250,000.
FDIC
The Federal Deposit Insurance Corporation is an independent U.S. government agency that insures deposits at member banks. It was created by the Banking Act of 1933 in response to widespread bank failures during the Great Depression.
Deposit insurance limit
The maximum dollar amount the FDIC will reimburse a depositor per ownership category, per insured bank. As of the Federal Deposit Insurance Reform Act of 2006, the standard limit is $250,000.
Ownership category
A classification the FDIC uses to determine how coverage applies. Common categories include single accounts, joint accounts, retirement accounts, and trust accounts. Each category is insured separately.
NCUA
The National Credit Union Administration insures deposits at federally insured credit unions in the same manner as the FDIC does for banks, also up to $250,000 per ownership category.
Receivership
The legal process by which the FDIC takes over a failed bank, manages its assets, and pays insured depositors. Most depositors receive access to their insured funds within one to two business days.
What FDIC Insurance Does NOT Cover
Many products sold or offered through banks fall entirely outside FDIC protection. These include:
- Investment products — stocks, bonds, mutual funds, exchange-traded funds (ETFs)
- Annuities — even if purchased through a bank branch
- Life insurance products
- Cryptocurrency
- U.S. Treasury securities — these are backed directly by the federal government, not the FDIC
- Safe deposit box contents
A common source of confusion: a money market deposit account (a bank product) is covered; a money market mutual fund (an investment product) is not. Always verify the account type before assuming coverage applies.
Credit Unions Have Equivalent Protection
If your money is at a credit union rather than a bank, look for the NCUA (National Credit Union Administration) seal instead of the FDIC seal. NCUA insurance covers the same account types up to the same $250,000 limit per ownership category. The protections are functionally equivalent, so you don't need to move funds simply because your institution is a credit union.
How to Stay Within Coverage Limits
If you hold more than $250,000 at a single bank, some strategies can help keep all deposits insured:
- Spread funds across ownership categories. Your individual account, a joint account with a spouse, and an IRA at the same bank are each insured separately up to $250,000.
- Use multiple insured banks. Moving funds to a second or third FDIC-member institution resets the coverage limit at each bank.
- Review beneficiary designations on trust accounts. Revocable trust accounts can receive additional coverage per eligible beneficiary, subject to FDIC rules.
Use the FDIC's free EDIE calculator (listed in resources below) to model your specific accounts before assuming you are fully covered. For decisions involving larger asset holdings or complex account structures, consulting a licensed financial adviser is advisable.
This article is for general informational purposes only and does not constitute personalized financial or legal advice. Consult a qualified financial professional for guidance specific to your situation.