FDIC insurance is federal protection for money held in deposit accounts at FDIC-insured banks: if the bank fails, you get your insured balance back, either through a healthy bank that takes over the deposits or through a direct payment from the FDIC. The standard limit is $250,000 per depositor, per insured bank, per ownership category, and it covers deposits only, not investments sold at a bank. Per the FDIC, no depositor has lost a penny of insured funds since the agency was founded in 1933.
Key takeaways
- Checking, savings, money market deposit accounts and CDs at an FDIC-insured bank are covered automatically; stocks, bonds, mutual funds (including money market mutual funds), crypto assets, annuities and safe deposit box contents are not.
- The $250,000 limit applies separately to each ownership category at each bank, so single, joint, retirement and trust accounts at one bank are insured separately.
- Since April 1, 2024, trust accounts are insured at $250,000 per beneficiary, up to 5 beneficiaries, for a maximum of $1,250,000 per owner at one bank.
- An app is not a bank: money in a fintech account is covered only if it actually sits at an insured bank, and the app's own failure is not covered.
- Check any balance above $250,000 with the FDIC's EDIE tool, and confirm the bank itself in BankFind.
What FDIC insurance covers
The FDIC insures deposit accounts at FDIC-insured banks: checking accounts, savings accounts, money market deposit accounts (MMDAs) and certificates of deposit (CDs). Its At A Glance brochure adds NOW accounts and cashier's checks, money orders and other official items issued by a bank. Coverage is automatic when you open one of these accounts; there is nothing to sign up for or pay. Funds are insured up to the standard maximum deposit insurance amount, which is $250,000 at present.
Insurance protects against one event: the failure of the insured bank. The FDIC says it does not cover losses from theft or fraud, which other laws address, or investment losses. The "per insured bank" part is literal: the FDIC's When a Bank Fails page says deposits in separate branches of one bank are not separately insured, while deposits at a different insured bank are.
What is not insured
The FDIC's page on financial products that are not insured says these are not covered, even when you buy them from an insured bank:
- stocks and bonds
- mutual funds, which the FDIC's deposit insurance basics guide says includes money market mutual funds
- crypto assets
- life insurance policies and annuities
- municipal securities
- the contents of a safe deposit box (other insurance, such as a homeowner's or renter's policy, may apply)
- U.S. Treasury bills, bonds and notes, which are backed by the full faith and credit of the U.S. government instead
The name confusion that catches people is "money market." A money market deposit account is a bank deposit and is insured. A money market mutual fund is an investment product with investment risk and no FDIC coverage. When a bank branch sells you an investment, the seller must disclose that it is not FDIC-insured; look for wording such as "This product is not insured by the Federal Deposit Insurance Corporation."
How ownership categories work
The limit is not per account. Per the FDIC, all your deposits in the same ownership category at the same bank are added together. Opening three savings accounts in your own name at the same bank does not triple your coverage. Using different categories does add coverage, as long as each category's requirements are met.
| Ownership category | Insured limit | Key condition |
|---|---|---|
| Single account | $250,000 per owner | One owner, no beneficiaries (naming a beneficiary moves the account to the trust category) |
| Joint account | $250,000 per co-owner | All co-owners are living people with equal withdrawal rights who signed the signature card (not required for CDs); shares presumed equal |
| Certain retirement accounts (IRAs, self-directed 401(k)-type plans, 457 plans) | $250,000 per owner | Only the money held as bank deposits is covered; naming beneficiaries does not raise the limit |
| Trust accounts | $250,000 per beneficiary, up to 5 per owner (maximum $1,250,000 per owner) | Covers informal (POD/ITF), revocable and irrevocable trusts |
| Corporation, partnership, unincorporated association | $250,000 per entity | The entity must be engaged in an independent activity, not set up just to add coverage |
| Employee benefit plan | $250,000 per plan participant | Covers the participant's non-contingent interest |
| Government accounts | $250,000 per official custodian | More may be available under specific conditions |
Figures are from the FDIC's Deposit Insurance At A Glance and Your Insured Deposits brochures, checked in November 2026. For joint accounts, each co-owner's shares across all joint accounts at the bank are added up, as 12 CFR 330.9 sets out. Two owners with a $350,000 joint CD and a $150,000 joint savings account are fully insured, because each owner's share is $250,000.
The 2024 trust account change
Before April 1, 2024, revocable and irrevocable trust deposits were insured under separate rules. A final rule the FDIC announced in FIL-7-2022 merged them into one trust category, effective April 1, 2024. Under 12 CFR 330.10, trust deposits are insured up to the standard amount multiplied by the number of beneficiaries the owner has identified, capped at 5 beneficiaries: $250,000 × 5 = $1,250,000 per owner, per bank. The FDIC says the change applies to existing accounts, including CDs, whatever their maturity date.
The conditions matter:
- Eligible beneficiaries are living people and IRS-recognized charities or nonprofits; the owner does not count, and neither does someone who inherits only if a named beneficiary has died.
- For an informal revocable trust (POD or ITF account), the beneficiaries must be specifically named in the bank's deposit records.
- A beneficiary named on several of your trust accounts at the same bank counts once, and coverage does not depend on how the money is split among beneficiaries.
- A trust with two owners is presumed to be funded in equal shares unless the bank's records say otherwise.
- If the co-owners of a revocable trust are its only beneficiaries, the deposits are treated as joint account deposits under 12 CFR 330.9 rather than as trust deposits.
A couple's coverage, worked out
Illustrative example: a married couple holds all their deposits at one bank. Each has a single account, they share a joint account, each has an IRA held as a bank deposit, and they have a revocable trust account naming their three children as beneficiaries. The trust has two owners, so the formula is applied to each owner.
| Account | Calculation | Insured maximum |
|---|---|---|
| Single accounts (2) | 2 × $250,000 | $500,000 |
| Joint account | 2 co-owners × $250,000 | $500,000 |
| IRAs (2) | 2 × $250,000 | $500,000 |
| Trust account | 2 owners × 3 beneficiaries × $250,000 | $1,500,000 |
| Total at one bank | $3,000,000 |
The $3,000,000 is a ceiling, reached only if every category is filled to its limit. With the equal-share presumption, each owner's trust share is $750,000, under the $1,250,000 per-owner cap. With five or more beneficiaries, the same trust would reach $2,500,000 for the couple (2 × $1,250,000). A balance that is large in one category and small in the others gets no benefit from the unused room; a $900,000 joint account is insured to $500,000 no matter how empty the single accounts are.
How to check your coverage
BankFind confirms that a bank is FDIC-insured; per the FDIC's deposit insurance page, you can search by name, certificate number, web address or location. EDIE, the Electronic Deposit Insurance Estimator, calculates how much of your money is insured based on the accounts and owners you enter. For complicated trusts, the FDIC answers questions at 1-877-ASK-FDIC (1-877-275-3342).
BankFind also lists the trade names and websites banks use to take deposits. That matters because, as the FDIC explains in its note on identifying unfamiliar banks and websites, deposits under a bank's official name and its trade names are added together and insured as one bank.
Look for the bank's name in BankFind rather than trusting a logo on a website. Credit unions will not appear there; they are insured by the NCUA's share insurance fund, which also protects up to $250,000 and is backed by the full faith and credit of the United States; the NCUA's Credit Union Locator shows whether a given credit union is federally insured, since some state-chartered credit unions use private insurance.
Fintech apps and pass-through risk
Many apps offer accounts but are not banks. The FDIC's guidance on banking with apps says non-bank companies are never FDIC-insured, and that funds are not insured unless and until the company deposits them in an FDIC-insured bank. Deposit insurance does not cover the closing of a non-bank company.
When an app places customer money at partner banks, the FDIC's brochure explains that funds held for you by a third party are insured as if deposited in your own name only if the bank's records disclose the relationship, the owners are identifiable, and the owners actually own the funds. Pass-through balances are also added to your other deposits in the same category at that bank, so an app account at a bank where you already have money can push you over a limit.
The FDIC suggests asking the company whether your funds will be deposited in an insured bank, when, and which bank holds them; confirm each named bank in BankFind and read the terms for how the money is protected.
What happens if your bank fails
The FDIC acts quickly when a bank fails. Often a healthy bank takes over the insured deposits, and the failed bank's customers become its depositors with access to their insured funds. When no bank takes over the deposits, the FDIC pays depositors directly by check up to the insured balance. Its Payment to Depositors page says such payments usually begin within a few days after the closing, that federal law requires payment "as soon as possible," and that the FDIC's goal is to pay within two business days.
Some deposits take longer because the FDIC needs documents first: accounts tied to a formal written trust, funds placed by a broker or other fiduciary, and employee benefit plan deposits. For money placed through a fiduciary, the FDIC pays the insurance to the fiduciary, which then pays its customers. The FDIC notifies each depositor in writing at the address on file, which is one reason to keep your address current.
Money above the limit becomes a claim against the failed bank, handled by the FDIC as receiver. Per the FDIC's page on priority of payments and timing, uninsured depositors are paid after insured depositors and before general creditors, from what the receiver recovers by selling the bank's assets. Those payments may be spread over several years, and how much comes back depends on what the asset sales recover.
Frequently asked questions
Is FDIC insurance per account or per person?
Neither, exactly: it is per depositor, per insured bank and per ownership category. Accounts in the same category at the same bank are added together and insured up to $250,000, while accounts in different categories, or at a separately chartered bank, are insured separately.
Does the $250,000 limit include interest?
Yes. The FDIC insures principal plus interest accrued through the day the bank fails, and the total counts toward the limit. Illustrative example: a single-owner CD of $248,000 that has accrued $3,000 in interest stands at $251,000, so $1,000 is above the limit.
Is a brokerage account at my bank covered?
Not by the FDIC, because it holds investments rather than deposits. The FDIC points to SIPC, a non-government entity that replaces missing securities and cash at a failed member brokerage up to $500,000, including up to $250,000 in cash. SIPC does not protect against a drop in the value of an investment.
What happens to a safe deposit box if the bank fails?
The FDIC says another institution usually takes over the failed bank's offices, including safe deposit locations, and you contact that institution for access. If no bank takes over, the FDIC contacts box holders with instructions for removing the contents. The contents themselves are not insured by the FDIC, so check the box rental agreement and your homeowner's or renter's policy.
Is FDIC insurance the same as NCUA insurance?
They are separate federal programs with the same standard $250,000 amount. The NCUA insures individual accounts at a federally insured credit union up to $250,000, a member's interest in all joint accounts combined up to $250,000, and IRA and Keogh retirement accounts separately up to $250,000.
A short checklist for your balances
- Confirm each bank in BankFind, including any trade names you bank under, and the credit union in the NCUA locator.
- Add up your balances by ownership category at each bank, including accrued interest and pass-through money from apps.
- Run any category near or above $250,000 through EDIE and note which accounts name beneficiaries.
- Move investment products and safe deposit contents out of your "insured" mental total; they are covered by other rules or not at all.
- Keep your mailing address current with the bank, and keep trust documents where you can produce them quickly.
This article is general education, not personal financial or legal advice; trust and estate accounts in particular can turn on the exact wording of the documents.
Sources
- FDIC, Deposit Insurance
- FDIC, Deposit Insurance Basics
- FDIC, Financial Products That Are Not Insured
- FDIC, Deposit Insurance At A Glance
- FDIC, Your Insured Deposits
- FDIC, Understanding Deposit Insurance
- 12 CFR 330.9, Joint ownership accounts (eCFR)
- 12 CFR 330.10, Trust accounts (eCFR)
- FDIC, FIL-7-2022: Final Rulemaking on Simplification of Deposit Insurance Rules for Trust and Mortgage Servicing Accounts
- FDIC, BankFind Suite
- FDIC, Electronic Deposit Insurance Estimator (EDIE)
- FDIC, Enhanced FDIC Tool Helps Consumers Identify Unfamiliar Banks and Websites
- FDIC, Banking With Apps
- FDIC, When a Bank Fails
- FDIC, Payment to Depositors
- FDIC, Priority of Payments and Timing
- NCUA, Share Insurance Coverage
