Banks vary in size and stature and with the nature of the products and services that are available to you. For the most part banks want to make sure you have confidence in their organization and that your deposits are safe and secure with them. In order to do so they will insure your deposits with the FDIC.
FDIC
The FDIC is the acronym for Federal Deposit Insurance Corporation, which is an agency of the government. The primary function of the FDIC is make sure that the deposits of customers are protected and insured in the event a bank would fail or become insolvent. What is great about this is the fact that the FDIC insurance is endorsed by or backed by the United States Government.
Here is how the FDIC operates. Lets look at an individual depositors account with a bank totaling less than $100,000 the complete deposit is fully insured. Also note a depositor is allowed to have more than $100,00 at one FDIC insured bank if and only if the account is able to meet certain requirements. Now as far as retirement accounts the agency will insure up to $250,000 for some retirement accounts.
To determine whether or not your bank or savings association is insured by the FDIC call this toll-free number at 1-877-275-3342 or you can go online at this website www.fdic.gov/deposit/index.
You are probably wondering what types of accounts are insured by the FDIC? Well let’s do a break down. First of all the FDIC will insure accounts including deposits in checking accounts, NOW, and savings accounts, money market deposit accounts. Coverage also extends to time deposits known as certificates of deposits. (CD). The balance of each account is insured up to the limit which does include principal and any accrued interest through the bank’s closing date.
Many people wonder about how this effects their stocks and bond, life insurance policies and mutual funds or even annuities or municipal securities as they pertain to the FDIC. The bad news is these are not covered by the FDIC even if you were to purchase them from an a bank insured by the FDIC.
If you have any type of U.S. Treasury bills or bonds or even notes these are not insured by the FDIC, however these are covered by the credit and faith of the United States government.
Also your deposits in one bank are not separately insured at a different branch office with the same bank. For example if you have $100,000 in XYZ bank and then you have $50,000 in XYZ bank but at another branch location your total deposits in XYZ bank is $150,000 but you are only insured for $100,000, and this pertains to per depositor per insured bank.
There are different situations which will allow you have more than $100,000 in a bank and still be insured. These situations can get complicated and detailed and depend on the number of account holders on an account, including whether or not it’s a joint account, revocable trust accounts, living/Family trust accounts or irrevocable trust accounts. Now these are just a few of the situations you will run into regarding the amount of coverage. If you need more information it is best to call the toll free number provided above and for the hearing impaired call 1-800-925-4618 and you will be able to receive information about coverage regarding you own particular situation. Always call the toll free number before you make any assumptions.
Other methods for contacting the FDIC include by mail at the following address: Federal Deposit Insurance Corporation 550 17th Street, NW Washington, DC 20429-9990 or you can email them using the FDIC online customer assistance form by accessing www2.fdic.gov/stars mail.