FDIC Insurance: What Is Covered and Where the Limits Sit
$250,000 per depositor, per bank, per ownership category. The last phrase does most of the work.
Federal deposit insurance protects money held at insured banks if the bank fails. Credit unions have an equivalent through the National Credit Union Administration. The standard limit is $250,000, and the phrase that decides how far it stretches is "per ownership category". The FDIC and the NCUA each publish coverage calculators and institution lookup tools.
The three-part rule
Coverage is $250,000 per depositor, per insured bank, per ownership category.
Two accounts at the same bank in the same category share one $250,000 limit. Accounts at two different banks each get their own limit. Accounts in different categories at the same bank each get their own limit.
Ownership categories
| Category | Coverage |
|---|---|
| Single accounts | $250,000 per depositor |
| Joint accounts | $250,000 per co-owner |
| Certain retirement accounts | $250,000 per depositor |
| Revocable trust accounts | Based on beneficiaries, subject to limits |
| Business accounts | $250,000 per entity |
A married couple at one bank can hold considerably more than $250,000 in insured deposits by using single and joint accounts together, because each category carries its own limit and a joint account covers each co-owner separately.
Two brands, one bank
Some banks operate under multiple brand names on a single charter. Deposits across those brands share one limit, because coverage follows the charter rather than the name on the website. The FDIC publishes a lookup tool for checking which institution a brand belongs to.
A worked example
Suppose a married couple hold everything at one bank. Here is how the categories stack.
| Account | Category | Insured |
|---|---|---|
| Her individual savings | Single | $250,000 |
| His individual savings | Single | $250,000 |
| Joint checking | Joint, two owners | $500,000 |
| Her IRA | Retirement | $250,000 |
| His IRA | Retirement | $250,000 |
That is $1.5 million of insured deposits at a single institution, without any special arrangement. Adding a second individual account for her at the same bank adds nothing, because it shares the single-account limit she already uses.
Credit unions work the same way
Deposits at federally insured credit unions are covered by the National Credit Union Share Insurance Fund, administered by the NCUA. The standard limit is also $250,000, and the ownership category structure is broadly similar.
The practical difference is which lookup tool you use to confirm coverage. The FDIC and the NCUA each publish their own, and an institution appears in one or the other rather than both.
What is covered
Checking accounts, savings accounts, money market deposit accounts, certificates of deposit, and official items such as cashier's checks. Principal and accrued interest up to the limit.
What is not
Deposit insurance covers deposits, not investments. These sit outside it even when purchased through your bank:
- Stocks, bonds and mutual funds
- Money market mutual funds, which differ from money market deposit accounts despite the similar name
- Annuities and life insurance products
- Municipal securities and Treasury securities bought through the bank, though Treasuries carry their own government backing
- Contents of a safe deposit box
- Cryptocurrency
Brokerage accounts have separate protection through SIPC, which covers securities and cash if a brokerage fails. That is protection against the firm failing, not against your investments losing value.
Fintech apps deserve a closer look
Many payment and savings apps are not banks. They hold customer funds at partner banks, and the marketing usually says deposits are "FDIC insured through" a named institution.
The distinction matters because the insurance protects you if the partner bank fails, and the picture is less clear if the app itself fails while holding your money. Recent failures in this space left customers waiting on funds. Read which bank holds the money, and check whether you already hold deposits at that same bank, since those balances share one limit.
If a bank fails
The FDIC usually arranges for another bank to assume the deposits, and accounts continue with new branding. Insured funds are typically available within a business day or two, and depositors generally do not need to file a claim. Amounts above the insured limit become claims against the failed bank's estate and may be repaid in part.
What deposit insurance does not protect against
Coverage applies when the institution fails. It does nothing about the other ways money leaves an account.
Fraud on your account is handled under separate consumer protection rules, principally Regulation E for electronic transfers, which sets out your liability and the timeframes for reporting. Report an unauthorized transaction quickly, because the protections weaken the longer you wait.
Losses from a payment you authorized, including one made to a scammer, generally sit outside both deposit insurance and those fraud rules. That is the argument for treating wires and instant payments with more care than the amount alone would suggest.
Staying within limits
If your balances approach $250,000 at one institution, options include spreading deposits across banks, using different ownership categories, or using a network service that distributes a single deposit across many insured institutions on your behalf.
The FDIC publishes a calculator that shows your coverage across accounts and categories. It is worth ten minutes if you hold large cash balances, particularly after a house sale or an inheritance, when balances sit high temporarily and nobody thinks to check.
This article is general information about how consumer finance products work in the United States. It is not financial, tax or legal advice and is not a recommendation of any specific product or provider. Rules and pricing vary by state and by institution.