How FDIC Deposit Insurance Works

FDIC insurance protects eligible deposits at an FDIC-insured bank if that bank fails. The standard limit is $250,000 per depositor, per insured bank, for each ownership category.

Which accounts are generally covered

FDIC insurance generally covers deposit products such as checking accounts, savings accounts, money-market deposit accounts and certificates of deposit at an insured bank. It also covers certain official items issued by a bank.

What the $250,000 limit means

The limit is not simply one flat amount per person everywhere. It is calculated per depositor, per FDIC-insured bank and per ownership category. Single accounts, certain joint accounts, retirement accounts and trust accounts can be treated under different categories when requirements are met.

What is not covered

Investment products are not transformed into insured deposits merely because they were purchased through a bank. Stocks, bonds, mutual funds, annuities, life-insurance policies and crypto assets are not FDIC-insured.

How to check coverage

Confirm that the institution is FDIC-insured and use the FDIC’s official insurance estimator when balances approach or exceed the standard limit. Pay attention to similarly named banks and to deposits held through financial-technology apps, where the account structure can affect how insurance applies.

Keep records current

Account titles, beneficiaries and ownership arrangements can affect coverage. Review them after major life events and ask the bank or FDIC when the structure is complex.

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This is an original AskNovus explanation based on the linked sources. Featured image: Towfiqu barbhuiya via Unsplash. This article is general education, not individualized financial advice. Information may change after publication; check official sources for updates.