FDIC insurance covers deposit accounts at member banks — checking accounts, savings accounts, money market deposit accounts, certificates of deposit, and official items like cashier’s checks — up to $250,000 per depositor, per insured bank, for each ownership category. It does not cover investment products, cryptocurrency, annuities, life insurance, or the contents of a safe deposit box, even when you buy or store those things at the same bank where you have a checking account. Understanding the difference between the two lists, and how the ownership-category rule can multiply your coverage at a single bank, is what keeps money safe if a bank fails.
Deposit Products That Are Covered
The FDIC insures the following products when they are held at a member bank:1FDIC.gov. Understanding Deposit Insurance
- Checking accounts, including negotiable order of withdrawal (NOW) accounts
- Savings accounts, both standard and high-yield
- Money market deposit accounts (MMDAs)
- Certificates of deposit (CDs), including brokered CDs when pass-through requirements are met
- Cashier’s checks, money orders, and other official items issued by the bank, if the bank fails before they clear
Coverage runs to both principal and interest accrued through the date the bank fails.2FDIC.gov. Deposit Insurance FAQs That detail traps people. If you hold a $248,000 CD that has earned $4,000 in interest, your insured balance is $252,000, and $2,000 sits outside the limit. Interest counts.
Deposits at U.S. insured banks that are denominated in a foreign currency are also covered. In a failure, the FDIC converts the balance to U.S. dollars at the Federal Reserve Bank of New York’s exchange rate on the date of failure, and the resulting amount is insured under the standard rules.3eCFR. 12 CFR Part 330 – Deposit Insurance Coverage
How the $250,000 Limit Actually Works
The standard insurance amount is $250,000 per depositor, per FDIC-insured bank, for each ownership category.1FDIC.gov. Understanding Deposit Insurance Three consequences follow from that structure.
All deposits you hold in a single ownership category at one bank are added together. A $150,000 checking account and a $120,000 savings account, both in your name alone at the same bank, are treated as $270,000 in one category. Twenty thousand dollars would be uninsured.
Deposits in different ownership categories at the same bank are insured separately. Your individual account and a joint account with your spouse each get their own $250,000 limit at that bank.
Deposits at different FDIC-insured banks are also insured separately. Two accounts at two different banks means two $250,000 limits.
Branches do not help. Deposits at different branches of the same bank are combined for insurance purposes because they belong to the same institution. Opening accounts at three branches of one bank does not triple your coverage.
Ownership Categories That Multiply Coverage at One Bank
Because the $250,000 limit resets for each ownership category, the same person can be insured for well over $250,000 at a single bank by holding funds in different categories.
Individual Accounts
A single-ownership account — one person, no beneficiaries named — is insured up to $250,000 at each FDIC-insured bank.4FDIC.gov. Financial Institution Employees Guide to Deposit Insurance – Single Accounts Every individual account you own at the same bank is combined into one bucket, whether it’s checking, savings, or a CD. Sole proprietorship business accounts fall into this same category and are added to the owner’s personal accounts for insurance purposes.5eCFR. 12 CFR 330.6 – Single Ownership Accounts
Joint Accounts
Joint accounts are their own category. Each co-owner’s share of all qualifying joint accounts at the same bank is insured up to $250,000.1FDIC.gov. Understanding Deposit Insurance Two co-owners can be insured up to $500,000 in joint accounts; three co-owners up to $750,000. The account must involve real people (not entities), and each co-owner must have equal withdrawal rights and be identifiable in the bank’s records.6eCFR. 12 CFR 330.9 – Joint Ownership Accounts If one person is on the account in name only and cannot actually withdraw, the FDIC treats the funds as the other person’s individual account instead.
Revocable Trust Accounts
Payable-on-death (POD) accounts, in-trust-for (ITF) accounts, and formal living trusts fall into the revocable trust category. Coverage is $250,000 per owner, per beneficiary, per bank, so an owner naming three eligible beneficiaries at one bank can be insured for up to $750,000.7FDIC.gov. Trust Accounts (12 CFR 330.10) Coverage does not scale indefinitely. When an owner names five or more beneficiaries, the maximum per owner caps at $1,250,000. Beneficiaries must be living people or qualifying charities and nonprofits.
Retirement Accounts
Certain retirement accounts held in deposit products at an FDIC-insured bank get their own $250,000 limit, separate from your individual or joint accounts. The qualifying types are traditional IRAs, Roth IRAs, SEP IRAs, and SIMPLE IRAs.8FDIC.gov. Certain Retirement Accounts The funds have to be in an actual deposit product — a savings account, MMDA, or CD. An IRA invested in mutual funds or stocks through a bank’s brokerage arm is not FDIC-insured, even though the IRA itself is a retirement account. All qualifying retirement deposits at the same bank are combined into one $250,000 bucket, and naming beneficiaries on an IRA does not increase the limit.
Employer-sponsored plans such as 401(k)s, pensions, and profit-sharing plans receive pass-through coverage: each participant’s non-contingent interest is insured up to $250,000, separate from that participant’s other accounts at the bank.9FDIC.gov. Employee Benefit Plan Accounts The same deposit-product requirement applies.
Business Accounts
Corporations, partnerships, and LLCs engaged in independent business activity each receive $250,000 in coverage per bank, separate from the personal accounts of any owners.10eCFR. 12 CFR 330.11 – Accounts of a Corporation, Partnership or Unincorporated Association All balances the entity holds at that bank — operating, payroll, reserve — combine toward that single $250,000 total.
What FDIC Insurance Does Not Cover
FDIC insurance protects deposit products only. Anything you buy through a bank that is not a deposit falls outside the guarantee, even if you bought it from the same branch and see it on the same statement. Explicitly excluded:11Federal Deposit Insurance Corporation. Financial Products That Are Not Insured by the FDIC
- Stocks, bonds, mutual funds, municipal securities, and exchange-traded funds
- Crypto assets, whether held by a bank or a third-party platform
- Annuities and life insurance policies, which are underwritten by insurance companies
- U.S. Treasury bills, bonds, and notes (backed by the full faith and credit of the U.S. government, but not FDIC-insured)
- Safe deposit box contents; the FDIC insures deposits, not physical property
Money market products are the most common source of confusion. A money market deposit account (MMDA) at a bank is insured. A money market mutual fund, even one sold through the same bank, is not.
Fintech Apps and Neobanks
Payment apps, neobanks, and other fintech companies are not themselves FDIC-insured. The FDIC has stated this directly: nonbank companies are never FDIC-insured, and funds sent to them are not eligible for deposit insurance until the company actually places the money at an FDIC-insured bank and the required records are in place.12FDIC.gov. Banking With Third-Party Apps
For pass-through insurance to work, the fintech company must keep records identifying who owns each dollar and how much each person owns. If those records are missing or inaccurate when a partner bank fails, funds may not be insured. Before entrusting a fintech app with significant money, find the specific FDIC-insured bank where your funds will be held and read the terms carefully. The 2024 collapse of Synapse Financial Technologies showed the risk when a middleware company between the customer and the actual bank loses track of whose money is whose; some depositors could not access their funds for months.
Credit Unions Use a Different Insurance Fund
Credit unions are not covered by the FDIC. Federally insured credit unions are protected instead by the National Credit Union Share Insurance Fund (NCUSIF), administered by the National Credit Union Administration. The coverage mirrors FDIC limits: $250,000 per member, per credit union, for each ownership category, with individual, joint, retirement, and trust accounts following the same basic structure.13National Credit Union Administration. Share Insurance Coverage
What Happens if a Bank Fails
Insured deposits are typically paid within a few business days of a failure. In most cases the FDIC arranges for another bank to assume the failed institution’s deposits, and customers wake up to find their accounts have simply moved.14FDIC.gov. Priority of Payments and Timing
Amounts above the insurance limit are different. The FDIC, acting as receiver, liquidates the failed bank’s assets and pays claims from the proceeds. Depositors with uninsured balances may eventually recover some or all of those funds, but the process can take months or years, and there is no guarantee of full recovery.15FDIC.gov. When a Bank Fails – Facts for Depositors, Creditors, and Borrowers That is the real cost of exceeding $250,000 — not that money disappears instantly, but that it can be tied up indefinitely with uncertain outcome.
If your bank is acquired by another FDIC-insured bank, your deposits continue to be insured separately from any existing accounts you hold at the acquiring bank for six months after the merger.3eCFR. 12 CFR Part 330 – Deposit Insurance Coverage A CD that matures after that six-month window keeps its separate coverage until its first maturity date past the six months. This gives you time to move money if the combined balances would run over.
How to Confirm a Bank Is FDIC-Insured
Not every institution accepting deposits is FDIC-insured. The FDIC maintains a free lookup tool called BankFind at banks.data.fdic.gov, where you can search by bank name or location. Member banks are also required to display the official FDIC sign at teller windows and on their websites. When using a fintech app or neobank, don’t rely on the app’s marketing; look up the specific partner bank in BankFind directly.