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UPDATED 2014 

YOUR INSURED 

DEPOSITS 

Federal Deposit Insurance Corporation 
 

 

 

 

 

 

 

 

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IMPORTANT INFORMATION ABOUT THIS BROCHURE 

Your Insured Deposits is a comprehensive description of FDIC deposit 

insurance coverage for the most common account ownership categories. 

This brochure is not intended as a legal interpretation of the FDIC’s 

laws and regulations. For additional or more specifc information about 

FDIC insurance coverage, consult the Federal Deposit Insurance Act 

(12 U.S.C.1811 et seq.) and the FDIC’s regulations relating to insurance 

coverage described in 12 C.F.R. Part 330. 

The information in this brochure is based on FDIC laws and regulations in 

effect at publication. These rules can be amended and, therefore, some of 

the information in this brochure may become outdated. The online version 

of this brochure, available on the FDIC’s website at www.fdic.gov/deposit/ 

deposits, will be updated immediately if rule changes affecting FDIC 

insurance coverage are made. 

Depositors should note that federal law expressly limits the amount of 

insurance the FDIC can pay to depositors when an insured bank fails, and 

no representation made by any person or organization can either increase 

or modify that amount. 

This brochure is not intended to provide estate planning advice. Depositors 

seeking such assistance should contact a fnancial or legal advisor. 

For simplicity, this brochure uses the term “insured bank” to mean any 

bank or savings association that is insured by the FDIC. To check whether 

the FDIC insures a specifc bank or savings association: 

• Call the FDIC toll-free: 1-877-275-3342

• Use FDIC’s “Bank Find” at: http://research.fdic.gov/bankfnd/

• Look for the FDIC sign where deposits are received

TABLE OF CONTENTS 

2 FDIC INSURANCE COVERAGE BASICS 

4 OWNERSHIP CATEGORIES 

4 SINGLE ACCOUNTS 

6 CERTAIN RETIREMENT ACCOUNTS 

8 JOINT ACCOUNTS 

11 REVOCABLE TRUST ACCOUNTS 

17 IRREVOCABLE TRUST ACCOUNTS 

18 EMPLOYEE BENEFIT PLAN ACCOUNTS 

21 CORPORATION/PARTNERSHIP/UNINCORPORATED ASSOCIATION ACCOUNTS 

22 GOVERNMENT ACCOUNTS 

26 UNIQUE OWNERSHIP SCENARIOS 

29 FREQUENTLY ASKED QUESTIONS 

SEE BACK COVER FOR MORE INFORMATION FROM THE FDIC 
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WHAT IS THE FDIC? 

The FDIC—short for the Federal Deposit Insurance Corporation—is an 

independent agency of the United States government. The FDIC protects 

depositors of insured banks located in the United States against the loss 

of their deposits if an insured bank fails. 

Any person or entity can have FDIC insurance coverage in an insured 

bank. A person does not have to be a U.S. citizen or resident to have his 

or her deposits insured by the FDIC. 

FDIC insurance is backed by the full faith and credit of the United States 

government. Since the FDIC began operations in 1934, no depositor has ever 

lost a penny of FDIC-insured deposits. 

FDIC COVERAGE BASICS 

FDIC insurance covers depositors’ accounts at each insured bank, 

dollar-for-dollar, including principal and any accrued interest through 

the date of the insured bank’s closing, up to the insurance limit. 

FDIC insurance covers all types of deposits received at an insured bank 

but does not cover investments, even if they were purchased at an 

insured bank. 

WHAT THE FDIC COVERS 

• Checking accounts 

• Negotiable Order of Withdrawal (NOW) accounts 

• Savings accounts 

• Money market deposit accounts (MMDA) 

• Time deposits such as certifcates of deposit (CDs) 

• Cashier’s checks, money orders, and other offcial items issued 

by a bank 

WHAT THE FDIC DOES NOT COVER 

• Stock investments 

• Bond investments 

• Mutual funds 

• Life insurance policies 

• Annuities 

• Municipal securities 

• Safe deposit boxes or their contents 

• U.S. Treasury bills, bonds or notes* 

*These investments are backed by the full faith and credit of the U.S. 

government. 

The standard deposit insurance amount is $250,000 

per depositor, per insured bank, for each account 

ownership category. 

The FDIC insures deposits that a person holds in one insured bank 

separately from any deposits that the person owns in another 

separately chartered insured bank. For example, if a person has a 

certifcate of deposit at Bank A and has a certifcate of deposit at Bank 

B, the amounts would each be insured separately up to $250,000. Funds 

deposited in separate branches of the same insured bank are not 

separately insured. 

The FDIC provides separate insurance coverage for funds depositors 

may have in different categories of legal ownership. The FDIC refers to 

these different categories as “ownership categories.” This means that 

a bank customer who has multiple accounts may qualify for more than 

$250,000 in insurance coverage if the customer’s funds are deposited 

in different ownership categories and the requirements for each 

ownership category are met. 
OWNERSHIP CATEGORIES 

This section describes the following FDIC ownership categories and the 

requirements a depositor must meet to qualify for insurance coverage 

above $250,000 at one insured bank. 

• Single Accounts 

• Certain Retirement Accounts 

• Joint Accounts 

• Revocable Trust Accounts 

• Irrevocable Trust Accounts 

• Employee Beneft Plan Accounts 

• Corporation/Partnership/Unincorporated Association Accounts 

• Government Accounts 

SINGLE ACCOUNTS 

A single account is a deposit owned by one person. 

This ownership category includes: 

• An account held in one person’s name only, provided the owner has not 

designated any benefciary(ies) who are entitled to receive the funds 

when the account owner dies 

• An account established for one person by an agent, nominee, 

guardian, custodian, or conservator, including Uniform Transfers 

to Minors Act accounts, escrow accounts and brokered deposit 

accounts 

• An account held in the name of a business that is a sole proprietorship 

(for example, a “Doing Business As” or DBA account) 

• An account established for or representing a deceased person’s 

funds—commonly known as a decedent’s 

estate account 

• An account that fails to qualify for separate coverage under another 

ownership category 

If an account title identifes only one owner, but another person has the 

right to withdraw funds from the account (e.g., as Power of Attorney 

or custodian), the FDIC will insure the account as a single ownership 

account. 

The FDIC adds together all single accounts owned by the same person 

at the same bank and insures the total up to $250,000. 

NOTE ON BENEFICIARIES: IF THE OWNER OF A SINGLE ACCOUNT HAS DESIGNATED ONE OR 

MORE BENEFICIARIES WHO WILL RECEIVE THE DEPOSIT WHEN THE ACCOUNT OWNER DIES, 

THE ACCOUNT WOULD BE INSURED AS A REVOCABLE TRUST ACCOUNT. 

EXAMPLE 1: SINGLE ACCOUNT 

ACCOUNT TITLE DEPOSIT TYPE ACCOUNT BALANCE 

MARCI JONES $ 20,000 

MARCI’S MEMORIES $ 25,000 (A SOLE PROPRIETORSHIP) 

AMOUNT INSURED $ 250,000 

MARCI JONES MMDA $ 15,000 

SAVINGS 

MARCI JONES CD $ 200,000 

CHECKING 

TOTAL $ 260,000 

AMOUNT UNINSURED $ 10,000 

EXPLANATION 

Marci Jones has four single accounts at the same insured bank, 

including one account in the name of her business, which is a 

sole proprietorship. The FDIC insures deposits owned by a sole 

proprietorship as the single account of the business owner. The FDIC 

combines the four accounts, which equal $260,000, and insures the total 

balance up to $250,000, leaving $10,000 uninsured. 

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CERTAIN RETIREMENT ACCOUNTS 

A retirement account is insured under the Certain Retirement Accounts 

ownership category only if the account qualifes as one of the following: 

• Individual Retirement Account (IRA): 

» Traditional IRA 

» Roth IRA 

» Simplifed Employee Pension (SEP) IRA 

» Savings Incentive Match Plans for Employees (SIMPLE) IRA 

• Self-directed defned contribution plan account includes 

» Self-directed 401(k) plan 

» Self-directed SIMPLE IRA held in the form of a 

401(k) plan 

» Self-directed defned contribution proft-sharing plan 

• Self-directed Keogh plan account (or H.R.10 plan account) designed 

for self-employed individuals 

• Section 457 deferred compensation plan account, such as an eligible 

deferred compensation plan provided by state and local governments 

regardless of whether the plan is self-directed 

The FDIC adds together all retirement accounts listed above owned by 

the same person at the same insured bank and insures the total amount 

up to $250,000. 

The FDIC defnes the term “self-directed” to mean that plan participants 

have the right to direct how the money is invested, including the ability 

to direct that deposits be placed at an FDIC-insured bank. 

The FDIC will consider an account to be self-directed if the participant 

of the retirement plan has the right to choose a particular bank’s deposit 

accounts as an investment option. For example: 

• If a plan has deposit accounts at a particular insured bank as its 

default investment option, then the FDIC would deem the plan to be 

self-directed for insurance coverage purposes because, by inaction, 

the participant has directed the placement of such deposits 

• If a plan consists only of a single employer/employee, and the 

employer establishes the plan with a single investment option of 

deposit accounts at a particular insured bank, then the plan would be 

considered self-directed for insurance coverage purposes 

The following types of deposits do not qualify as Certain Retirement 

Accounts: 

• A plan for which the only investment vehicle is the deposit accounts of 

a particular bank, so that participants have no choice of investments 

• Deposit accounts established under section 403(b) of the Internal 

Revenue Code (annuity contracts for certain employees of public 

schools, tax-exempt organizations and ministers), which are insured 

as Employee Beneft Plan accounts 

• Defned-beneft plan deposits (plans for which the benefts are 

determined by an employee’s compensation, years of service and 

age), which are insured as Employee Beneft Plan accounts 

• Defned contribution plans that are not self-directed, which are 

insured as Employee Beneft Plan Accounts 

• Coverdell Education Savings Accounts (formerly known as Education 

IRAs), Health Savings Accounts or Medical Savings Accounts (see the 

section on Unique Ownership Situations for guidance on the deposit 

insurance coverage) 

NOTE ON BENEFICIARIES: WHILE SOME SELF-DIRECTED RETIREMENT ACCOUNTS, LIKE 

IRAS, PERMIT THE OWNER TO NAME ONE OR MORE BENEFICIARIES, THE EXISTENCE OF 

BENEFICIARIES DOES NOT INCREASE THE AVAILABLE INSURANCE COVERAGE. 

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EXAMPLE 2: CERTAIN RETIREMENT ACCOUNTS 

ACCOUNT TITLE ACCOUNT BALANCE 

BOB JOHNSON’S ROTH IRA $ 110,000 

BOB JOHNSON’S IRA $ 75,000 

TOTAL $ 185,000 

AMOUNT INSURED $ 185,000 

AMOUNT UNINSURED $ 0 

EXPLANATION 

Bob Johnson has two different types of retirement accounts that qualify 

as Certain Retirement Accounts at the same insured bank. The FDIC 

adds together the deposits in both accounts, which equal $185,000. 

Since Bob’s total in all certain retirement accounts at the same bank is 

less than $250,000, his IRA deposits are fully insured. 

JOINT ACCOUNTS 

A joint account is a deposit owned by two or more people. FDIC 

insurance covers joint accounts owned in any manner conforming to 

applicable state law, such as joint tenants with right of survivorship, 

tenants by the entirety and tenants in common. 

To qualify for insurance coverage under this ownership category, 

all of the following requirements must be met: 

1. All co-owners must be living people. Legal entities such as 

corporations, trusts, estates or partnerships are not eligible for 

joint account coverage. 

2. All co-owners must have equal rights to withdraw deposits from 

the account. For example, if one co-owner can withdraw deposits 

on his or her signature alone but the other co-owner can withdraw 

deposits only with the signature of both co-owners, the co-owners 

would not have equal withdrawal rights. 

3. All co-owners must sign the deposit account signature card 

unless the account is a CD or is established by an agent, nominee, 

guardian, custodian, executor or conservator. 

If all of these requirements are met, each co-owner’s shares of every 

joint account that he or she owns at the same insured bank are added 

together and the total is insured up to $250,000. 

The FDIC assumes that all co-owners’ shares are equal unless the 

deposit account records state otherwise. 

The balance of a joint account can exceed $250,000 and still be fully 

insured. For example, if the same two co-owners jointly own both a 

$350,000 CD and a $150,000 savings account at the same insured bank, 

the two accounts would be added together and insured up to $500,000, 

providing up to $250,000 in insurance coverage for each co-owner. This 

example assumes that the two co-owners have no other joint accounts 

at the bank. 

There is no kinship requirement for joint account coverage. Any two or 

more people that co-own funds can qualify for insurance coverage in 

the joint account ownership category provided the requirements listed 

above are met. 

Insurance coverage of joint accounts is not increased by rearranging 

the owners’ names or Social Security numbers or changing the styling 

of their names. Alternating the use of “or,” “and” or “and/or” to 

separate the names of co-owners in a joint account title also does not 

affect the amount of insurance coverage provided. 

NOTE ON BENEFICIARIES: IF THE CO-OWNERS OF A JOINTLY HELD ACCOUNT HAVE 

DESIGNATED ONE OR MORE BENEFICIARIES WHO WILL RECEIVE THE DEPOSIT WHEN THE 

CO-OWNERS DIE, THE ACCOUNT WOULD BE INSURED AS A REVOCABLE TRUST ACCOUNT. 

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EXAMPLE 3: JOINT ACCOUNTS 

ACCOUNT TITLE DEPOSIT TYPE ACCOUNT BALANCE SHARE PER OWNER 

TOTAL $ 800,000 

INSURANCE COVERAGE FOR EACH OWNER IS CALCULATED 

AS FOLLOWS: 

OWNERS TOTAL OF ALL OWNERSHIP SHARES AMOUNT INSURED AMOUNT UNINSURED 

TOTAL $ 800,000 $ 590,000 $ 210,000 

EXPLANATION 

• The total amount in each joint account is divided by the number 

of co-owners. 

• Mary’s ownership share in all joint accounts equals 1/2 of the 

MMDA account ($115,000), 1/2 of the savings account ($150,000), and 

1/3 of the CD ($90,000), for a total of $355,000. Since her coverage in 

the joint account ownership category is limited to $250,000, $105,000 

is uninsured. 

• John’s ownership share in all joint accounts is the same as Mary’s, 

so $105,000 of John’s deposits is uninsured. 

• Robert’s ownership share in all joint accounts equals 

1/3 of the CD, or $90,000, so his share is fully insured. 

MARY AND JOHN SMITH MMDA $ 230,000 $ 115,000 

MARY OR JOHN SMITH SAVINGS $ 300,000 $ 150,000 

MARY OR JOHN OR ROBERT SMITH CD $ 270,000 $ 90,000 

MARY $ 355,000 $ 250,000 $ 105,000 

JOHN $ 355,000 $ 250,000 $ 105,000 

ROBERT $ 90,000 $ 90,000 $ 0 

REVOCABLE TRUST ACCOUNTS 

This section explains FDIC insurance coverage for revocable trust 

accounts, and is not intended as estate planning advice or guidance. 

Depositors should contact a legal or fnancial advisor for assistance 

with estate planning. 

A revocable trust account is a deposit account owned by one or more 

people that identifes one or more benefciaries who will receive the 

deposits upon the death of the owner(s). A revocable trust can be 

revoked, terminated or changed at any time, at the discretion of the 

owner(s). In this section, the term “owner” means the grantor, settlor, 

or trustor of the revocable trust. 

When calculating deposit insurance coverage, the designation of 

trustees, co-trustees and successor trustees is not relevant. They are 

administrators and are not considered in calculating deposit insurance 

coverage. 

This ownership category includes both informal and formal 

revocable trusts: 

• Informal revocable trusts—often called payable on death, Totten trust, 

in trust for, or as trustee for accounts—are created when the account 

owner signs an agreement, usually part of the bank’s signature card, 

directing the bank to transfer the funds in the account to one or more 

named benefciaries upon the owner’s death. 

• Formal revocable trusts—known as living or family trusts—are written 

trusts created for estate planning purposes. The owner controls the 

deposits and other assets in the trust during his or her lifetime. The 

agreement establishes that the deposits are to be paid to one or more 

identifed benefciaries upon the owner’s death. The trust generally 

becomes irrevocable upon the owner’s death. 

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COVERAGE AND REQUIREMENTS FOR REVOCABLE TRUST ACCOUNTS 

In general, the owner of a revocable trust account is insured up 

to $250,000 for each unique benefciary, if all of the following 

requirements are met: 

1. The account title at the bank must indicate that the account is held 

pursuant to a trust relationship. This rule can be met by using the 

terms payable on death (or POD), in trust for (or ITF), as trustee for (or 

ATF), living trust, family trust, or any similar language, including simply 

having the word “trust” in the account title. The account title includes 

information contained in the bank’s electronic deposit account 

records. 

2. The benefciaries must be named in either the deposit account 

records of the bank (for informal revocable trusts) or identifed in 

the formal revocable trust document. For a formal trust agreement, 

it is acceptable for the trust to use language such as “my issue” 

or other commonly used legal terms to describe the designated 

benefciaries, provided the specifc names and number of eligible 

benefciaries can be determined. 

3. To qualify as an eligible benefciary, the benefciary must be a living 

person, a charity or a non-proft organization. If a charity or nonproft organization is named as benefciary, it must qualify as such 

under Internal Revenue Service (IRS) regulations. 

An account must meet all of the above requirements to be insured under 

the revocable trust ownership category. Typically, if any of the above 

requirements are not met, the entire amount in the account, or the portion 

of the account that does not qualify, is added to the owner’s other single 

accounts, if any, at the same bank and insured up to $250,000. If the trust 

has multiple co-owners, each owner’s share of the non-qualifying amount 

would be treated as his or her single ownership account. 

Insurance coverage for revocable trust accounts is calculated 

differently depending on the number of benefciaries named by the 

owner, the benefciaries’ interests and the amount of the deposit. 

Two calculation methods are used to determine insurance coverage of 

revocable trust accounts: one method is used only when a revocable 

trust owner has fve or fewer unique benefciaries; the other method is 

used only when an owner has six or more unique benefciaries. 

If a trust has more than one owner, each owner’s insurance coverage is 

calculated separately. 

REVOCABLE TRUST INSURANCE COVERAGE – FIVE OR FEWER UNIQUE BENEFICIARIES 

When a revocable trust owner names five or fewer beneficiaries, 

the owner’s trust deposits are insured up to $250,000 for each 

unique beneficiary. 

This rule applies to the combined interests of all benefciaries the 

owner has named in all formal and informal revocable trust accounts at 

the same bank. When there are fve or fewer benefciaries, maximum 

deposit insurance coverage for each trust owner is determined 

by multiplying $250,000 times the number of unique benefciaries, 

regardless of the dollar amount or percentage allotted to each unique 

benefciary. Therefore, a revocable trust with fve unique benefciaries 

is insured up to $1,250,000. 

MAXIMUM INSURANCE COVERAGE FOR A TRUST OWNER WHEN 

THERE ARE FIVE OR FEWER UNIQUE BENEFICIARIES: 

NUMBER OF UNIQUE BENEFICIARIES MAXIMUM DEPOSIT INSURANCE COVERAGE 

1 BENEFICIARY $ 250,000 

2 BENEFICIARIES $ 500,000 

3 BENEFICIARIES $ 750,000 

4 BENEFICIARIES $1,000,000 

5 BENEFICIARIES $1,250,000 

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EXAMPLE 4: POD ACCOUNTS FOR ONE OWNER WHEN 

THERE ARE FIVE OR FEWER UNIQUE BENEFICIARIES 

ACCOUNT TITLE OWNER BENEFICIARIES DEPOSIT TYPE ACCOUNT BALANCE 

JOHN JONES POD JOHN JACK, JANET MMDA $ 10,000 

JOHN JONES POD JOHN JACK, JANET SAVINGS $ 20,000 

JOHN JONES POD JOHN JACK, JANET CD $ 470,000 

TOTAL $ 500,000 

AMOUNT INSURED $ 500,000 

AMOUNT UNINSURED $ 0 

EXPLANATION 

John Jones has three revocable trust accounts at the same insured 

bank. For each of these accounts, John has named the same two 

unique benefciaries. Maximum insurance coverage for these 

accounts is calculated as $250,000 times two benefciaries, which 

equals $500,000. John Jones is fully insured. 

EXAMPLE 5: MULTIPLE REVOCABLE TRUST ACCOUNTS 

WITH FIVE OR FEWER UNIQUE BENEFICIARIES 

ACCOUNT NUMBER ACCOUNT OWNER(S) ACCOUNT BENEFICIARIES ACCOUNT BALANCE 

LISA LI SHARON AND BILL LI $450,000 (POD) 

1 PAUL & LISA LI 

(LIVING TRUST) JOHN AND SHARON LI $700,000 

OWNERS BENEFICIARIES OWNER’S SHARE AMOUNT INSURED AMOUNT UNINSURED 

PAUL JOHN, SHARON $ 350,000 $ 350,000 $ 0 

LISA JOHN, SHARON, BILL $ 800,000 $ 750,000 $ 50,000 

TOTAL $1,150,000 $1,100,000 $ 50,000 

EXPLANATION 

When a revocable trust owner names fve or fewer benefciaries, 

the owner’s share of each trust account is added together and the 

owner receives up to $250,000 in insurance coverage for each unique 

benefciary. 

• Paul’s share: $350,000 (50% of Account 1) 

• Lisa’s share: $800,000 (50% of Account 1 and 100% of Account 2) 

Because Paul named two unique benefciaries, his maximum insurance 

coverage is $500,000 ($250,000 times two benefciaries). Since his share 

of Account 1- $350,000 - is less than $500,000, he is fully insured. 

Because Lisa has named three unique benefciaries between Accounts 

1 and 2, her maximum insurance coverage is $750,000 ($250,000 times 

three benefciaries). Since her share of both accounts - $800,000 -

exceeds $750,000, she is uninsured for $50,000. 

REVOCABLE TRUST INSURANCE COVERAGE - SIX OR MORE UNIQUE BENEFICIARIES 

Equal Beneficial Interests 

When a revocable trust owner names six or more unique benefciaries, 

and all the benefciaries have an equal interest in the trust (i.e., 

every benefciary receives exactly the same amount), the insurance 

calculation is the same as for revocable trusts that name fve or fewer 

benefciaries. The trust owner receives insurance coverage up to 

$250,000 for each unique benefciary. As shown below, with one owner 

and six benefciaries, with equal benefcial interests, the owner’s 

maximum insurance coverage is up to $1,500,000. 2 

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MAXIMUM INSURANCE COVERAGE FOR EACH REVOCABLE TRUST 

OWNER WHEN THERE ARE SIX OR MORE UNIQUE BENEFICIARIES 

WITH EQUAL BENEFICIAL INTERESTS: 

NUMBER OF UNIQUE BENEFICIARIES MAXIMUM DEPOSIT INSURANCE COVERAGE 

6 BENEFICIARIES WITH EQUAL INTERESTS $ 1,500,000 

7 BENEFICIARIES WITH EQUAL INTERESTS $ 1,750,000 

8 BENEFICIARIES WITH EQUAL INTERESTS $ 2,000,000 

9 BENEFICIARIES WITH EQUAL INTERESTS $ 2,250,000 

10+ BENEFICIARIES WITH EQUAL INTERESTS ADD UP TO $250,000 FOR EACH ADDITIONAL UNIQUE BENEFICIARY 

Unequal Beneficial Interests 

When a revocable trust owner names six or more benefciaries and the 

benefciaries do not have equal benefcial interests (i.e., they receive 

different amounts), the owner’s revocable trust deposits are insured for 

the greater of either: (1) the sum of each benefciary’s actual interest in 

the revocable trust deposits up to $250,000 for each unique benefciary, 

or (2) a minimum coverage amount of $1,250,000. 

Determining insurance coverage of a revocable trust that has six or 

more unique benefciaries whose interests are unequal can be complex. 

For information on coverage beyond the minimum coverage amount of 

$1,250,000 per owner, please contact the FDIC for assistance using the 

contact information at the end of this brochure. 

FDIC FAST FACT 

An owner who identifies a beneficiary as having a life estate interest in a formal revocable 

trust is entitled to insurance coverage up to $250,000 for that beneficiary. A life estate 

beneficiary is a beneficiary who has the right to receive income from the trust or to use trust 

deposits during the beneficiary’s lifetime, where other beneficiaries receive the remaining 

trust deposits after the life estate beneficiary dies. 

For example: A husband is the sole owner of a living trust that gives his wife a life estate 

interest in the trust deposits, with the remainder going to their two children upon his wife’s 

death. Maximum insurance coverage for this account is calculated as follows: $250,000 

times three different beneficiaries equals $750,000. 

IRREVOCABLE TRUST ACCOUNTS 

Irrevocable trust accounts are deposit accounts held in connection 

with a trust established by statute or a written trust agreement in which 

the owner (also referred to as a grantor, settlor or trustor) contributes 

deposits or other property to the trust and gives up all power to cancel 

or change the trust. An irrevocable trust also may come into existence 

upon the death of an owner of a revocable trust. 

A revocable trust account that becomes an irrevocable trust account 

due to the death of the trust owner may continue to be insured under 

the rules for revocable trusts. Therefore, in such cases, the rules in the 

revocable trust section may be used to determine coverage. 

The interests of a benefciary in all deposit accounts under an irrevocable 

trust established by the same settlor and held at the same insured bank 

are added together and insured up to $250,000, only if all of the following 

requirements are met: 

• The trust must be valid under state law 

• The insured bank’s deposit account records must disclose the 

existence of the trust relationship 

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• The benefciaries and their interests in the trust must be identifable 

from the bank’s deposit account records or from the trustee’s records 

• The amount of each benefciary’s interest must not be contingent as 

defned by FDIC regulations 

If the owner retains an interest in the trust, then the amount of the 

owner’s retained interest would be added to the owner’s other single 

accounts, if any, at the same insured bank and the total insured up to 

$250,000. 

For example, if the grantor of an irrevocable trust is still living, 

and the trust provides that trust assets can either be used by the 

grantor or by a trustee on behalf of the grantor, the grantor would 

be deemed to have a retained interest. Thus, this irrevocable trust 

account would not be insured under the irrevocable trust ownership 

category, but as a single ownership deposit of the grantor. The 

balance of the account would be added together with any other 

single ownership accounts the grantor has at the same bank, and 

the total would be insured up to $250,000. 

FDIC FAST FACT 

Since irrevocable trusts usually contain conditions that affect the interests of the 

beneficiaries or provide a trustee or a beneficiary with the authority to invade the principal, 

insurance coverage for an irrevocable trust account usually is limited to $250,000. 

An owner or trustee of an irrevocable trust account who is unsure of the provisions of the 

trust should consult a legal or financial advisor. 

EMPLOYEE BENEFIT PLAN ACCOUNTS 

An employee beneft plan account is a deposit of a pension plan, 

defned beneft plan or other employee beneft plan that is not selfdirected. An account insured under this category must meet the 

defnition of an employee beneft plan in section 3(3) of the Employee 

Retirement Income Security Act (ERISA) of 1974, with the exception 

of plans that qualify under the Certain Retirement Account ownership 

category. The FDIC does not insure the plan itself, but insures the 

deposit accounts owned by the plan. 

Additional requirements for coverage: 

• The investment and management decisions relating to the account 

must be controlled by a plan administrator (not self-directed by the 

participant). 

• The plan administrator must maintain documentation supporting the 

plan and the benefcial interest of the participants 

• The account must be properly titled as an employee beneft account 

with the bank 

» When all of these requirements are met, the FDIC will insure each 

participant’s interest in the plan up to $250,000, separately from any 

accounts the employer or employee may have in the same FDIC 

insured institution. The FDIC often refers to this coverage as “passthrough coverage” because the insurance coverage passes through 

the employer (agent) that established the account to the employee 

who is considered the owner of the funds. 

Even when plans qualify for pass-through coverage, insurance 

coverage cannot be determined simply by multiplying the number of 

participants by $250,000 because plan participants frequently have 

different interests in the plan. 

To determine the maximum amount a plan can have on deposit in a 

single bank and remain fully insured, the plan administrator must frst 

identify the participant who has the largest share of the plan assets, 

and calculate the participant’s share as a percentage of overall plan 

assets. Then, the plan administrator must divide $250,000 by that 

percentage to arrive at the maximum fully insured amount that a plan 

can have on deposit at one bank. 

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EXAMPLE 6: EMPLOYEE BENEFIT PLAN THAT QUALIFIES FOR 

PASS-THROUGH COVERAGE 

The Happy Pet Vet Clinic has a proft-sharing plan for its employees 

ACCOUNT TITLE BALANCE 

HAPPY PET VET CLINIC BENEFIT PLAN $700,000 

PLAN PARTICIPANTS PLAN SHARE SHARE OF DEPOSIT AMOUNT INSURED AMOUNT UNINSURED 

DR. TODD 35% $ 245,000 $ 245,000 $ 0 

DR. JONES 30% $ 210,000 $ 210,000 $ 0 

TECH EVANS 20% $ 140,000 $ 140,000 $ 0 

TECH BARNES 15% $ 105,000 $ 105,000 $ 0 

PLAN TOTAL 100% $ 700,000 $ 700,000 $ 0 

EXPLANATION 

This employee beneft plan’s $700,000 deposit is fully insured. Because 

Dr. Todd’s share of the $700,000 deposit (35% of $700,000 = $245,000) 

is less than $250,000, and all of the other participants’ shares of the 

deposit also are less than $250,000, the entire deposit is insured. 

To determine the maximum amount this employee beneft plan can 

deposit at one bank and ensure all of the funds are fully covered, 

$250,000 should be divided by the percentage share of the plan 

participant with the largest interest in the plan. In this example, the 

maximum fully insured balance for this plan is $714,285. This amount is 

calculated as follows: $250,000 divided by 35% or 0.35 = $714,285. 

Plan participants who want to know more about how an employee 

beneft plan’s deposits are insured should consult with the plan 

administrator. 

FDIC FAST FACT 

Employee benefit plan deposits that do not qualify for pass-through coverage, such as health 

and welfare plans, are insured up to $250,000 per bank. Health and welfare plans usually 

do not qualify for pass-through coverage because the interests of the participants are not 

ascertainable. A participant will receive payments from the plan based on claims he or she 

files independent of any specific ownership interest in the plan. 

CORPORATION/PARTNERSHIP/UNINCORPORATED ASSOCIATION ACCOUNTS 

Deposits owned by corporations, partnerships, and unincorporated 

associations, including for-proft and not-for-proft organizations, are 

insured under the same ownership category. Such deposits are insured 

separately from the personal deposits of the organization’s owners, 

stockholders, partners or members. 

Unincorporated associations typically insured under this category 

include churches and other religious organizations, community and civic 

organizations and social clubs. 

To qualify for insurance coverage under this ownership category, 

a corporation, partnership or unincorporated association must be 

engaged in an “independent activity,” meaning that the entity is 

operated primarily for some purpose other than to increase deposit 

insurance coverage. 

All deposits owned by a corporation, partnership, or unincorporated 

association at the same bank are combined and insured up to $250,000. 

Accounts owned by the same corporation, partnership, or 

unincorporated association but designated for different purposes are 

not separately insured. 

For example: If a corporation has both an operating account and a 

reserve account at the same bank, the FDIC would add both accounts 

together and insure the deposits up to $250,000. Similarly, if a 

corporation has divisions or units that are not separately incorporated, 

the FDIC would combine the deposit accounts of those divisions or units 

20 21 
with any other deposit accounts of the corporation at the bank and the 

total would be insured up to $250,000. 

The number of partners, members, stockholders or account signatories 

established by a corporation, partnership or unincorporated association 

does not affect insurance coverage. 

For example: The FDIC insures deposits owned by a homeowners’ 

association at one insured bank up to $250,000 in total, not $250,000 for 

each member of the association. 

FDIC FAST FACT 

Accounts held in the name of a sole proprietorship are not insured under this ownership 

category. Rather, they are insured as the single account deposits of the owner, added to the 

owner’s other single accounts, if any, at the same bank and the total insured up to $250,000. 

GOVERNMENT ACCOUNTS 

The category known as government accounts (also called Public Unit 

accounts) includes deposit accounts owned by: 

• The United States, including federal agencies 

• Any state, county, municipality (or a political subdivision of any state, 

county or municipality), the District of Columbia, Puerto Rico and other 

government possessions and territories 

• An Indian tribe 

Insurance coverage of a government account is unique in that the 

insurance coverage extends to the offcial custodian of the deposits 

belonging to the government or public unit, rather than to the 

government unit itself. 

Accounts held by an offcial custodian of a government unit will be 

insured as follows: 

In-state accounts: 

• Up to $250,000 for the combined amount of all time and savings 

accounts (including NOW accounts) 

• Up to $250,000 for the combined amount of all interest-bearing and 

noninterest-bearing demand deposit accounts (since July 21, 2011, 

banks have been allowed to pay interest on demand deposit accounts) 

Out-of-state accounts: 

• up to $250,000 for the combined amount of all deposit accounts 

FDIC FAST FACT 

A Negotiable Order of Withdrawal (NOW) account is a savings deposit - not a demand 

deposit account. 

To learn more about deposit insurance coverage for Government Accounts, see the FDIC’s 

Fact Sheet – Deposit Insurance for Accounts Held by Government Depositors at: 

www.fdic.gov/deposit/deposits/factsheet.html 

PUTTING IT ALL TOGETHER: USING MULTIPLE OWNERSHIP CATEGORIES 

The FDIC provides separate insurance coverage for a depositor’s funds 

at the same insured bank if the deposits are held in different ownership 

categories. To qualify for this expanded coverage, the requirements for 

insurance coverage in each ownership category must be met. 

The example on the next page illustrates how a husband and wife with 

three children could qualify for up to $3,500,000 in FDIC coverage at 

one insured bank. This example assumes that the funds are in qualifed 

deposit products at an insured bank and these are the only accounts 

that the family has at the bank. 

Note: This example is intended solely to describe the use of different 

account ownership categories and not to provide estate planning 

advice. 

22 23 
EXAMPLE 7: INSURANCE COVERAGE FOR A HUSBAND AND WIFE WITH 

DEPOSIT ACCOUNTS IN MULTIPLE OWNERSHIP CATEGORIES 

ACCOUNT TITLE 

ACCOUNT 

OWNERSHIP 

CATEGORY 

OWNER(S) BENEFICIARY(IES) MAXIMUM INSURABLE 

AMOUNT 

HUSBAND SINGLE 

ACCOUNT HUSBAND $ 250,000 

WIFE SINGLE 

ACCOUNT WIFE $ 250,000 

HUSBAND & WIFE JOINT ACCOUNT HUSBAND & 

WIFE $ 500,000 

HUSBAND POD REVOCABLE 

TRUST ACCOUNT HUSBAND WIFE $ 250,000 

WIFE POD REVOCABLE 

TRUST ACCOUNT WIFE HUSBAND $ 250,000 

HUSBAND & WIFE 

LIVING TRUST 

REVOCABLE 

TRUST ACCOUNT 

HUSBAND & 

WIFE 

CHILD 1 

CHILD 2 

CHILD 3 

$ 1,500,000 

HUSBAND IRA 

CERTAIN 

RETIREMENT 

ACCOUNT 

HUSBAND $ 250,000 

WIFE IRA 

CERTAIN 

RETIREMENT 

ACCOUNT 

WIFE $ 250,000 

TOTAL $3,500,000 

EXPLANATION 

Single Account Ownership Category 

The FDIC combines all single accounts owned by the same person 

at the same bank and insures the total up to $250,000. The Husband’s 

single account deposits do not exceed $250,000 so his funds are fully 

insured. The same facts apply to the Wife’s single account deposits. 

Both accounts are fully insured. 

Joint Account Ownership Category 

Husband and Wife have one joint account at the bank. The FDIC 

combines each co-owner’s shares of all joint accounts at the bank and 

insures each co-owner’s total up to $250,000. Husband’s ownership 

share in all joint accounts at the bank equals 1⁄2 of the joint account or 

$250,000, so his share is fully insured. Wife’s ownership share in all joint 

accounts at the bank equals 1⁄2 of the joint account or $250,000, so her 

share is fully insured. 

Revocable Trust Account Ownership Category 

To determine insurance coverage of revocable trust accounts, the FDIC 

frst determines the amount of the trust’s deposits belonging to each 

owner. In this example: 

• Husband’s share = $1,000,000 (100% of the Husband’s POD account 

naming Wife as benefciary and 50% of the Husband and Wife Living 

Trust account identifying Child 1, Child 2, and Child 3 as benefciaries) 

• Wife’s share = $1,000,000 (100% of the Wife’s POD account naming 

Husband as benefciary and 50% of the Husband and Wife Living 

Trust account identifying Child 1, Child 2, and Child 3 as benefciaries) 

Second, the FDIC determines the number of benefciaries for each 

owner. In this example, each owner has four unique benefciaries 

(Spouse, Child 1, Child 2 and Child 3). When a revocable trust owner 

names fve or fewer unique benefciaries, the owner is insured up 

to $250,000 for each unique benefciary. Husband’s share of the 

revocable trust deposits is insured up to $1,000,000 ($250,000 times 

four benefciaries = $1,000,000). Wife’s share of the revocable trust 

deposits is insured up to $1,000,000 ($250,000 times four benefciaries = 

$1,000,000). 

24 25 
Certain Retirement Account Ownership Category 

The FDIC adds together all certain retirement accounts owned by the 

same person at the same bank and insures the total up to $250,000. The 

Husband and Wife each have an IRA deposit at the bank with a balance 

of $250,000. Because each account is within the insurance limit, the 

funds are fully insured. 

UNIQUE OWNERSHIP SCENARIOS 

FIDUCIARY ACCOUNTS 

What are fduciary accounts? 

Fiduciary accounts are deposit accounts owned by one party but held in 

a fduciary capacity by another party. Fiduciary relationships may include, 

but are not limited to, an agent, nominee, guardian, executor or custodian. 

Common fduciary accounts include Uniform Transfers to Minors Act 

accounts, escrow accounts, Interest On Lawyer Trust Accounts and 

deposit accounts obtained through a broker. 

What are the FDIC requirements for fduciary accounts? 

The fduciary nature of the account must be disclosed in the bank’s 

deposit account records (e.g., “Jane Doe as Custodian for Susie Doe” 

or “First Real Estate Title Company, Client Escrow Account”). The name 

and ownership interest of each owner must be ascertainable from the 

deposit account records of the insured bank or from records maintained 

by the agent (or by some person or entity that has agreed to maintain 

records for the agent). 

Special disclosure rules apply to multi-tiered fduciary relationships. 

If an agent pools the deposits of several owners into one account and 

the disclosure rules are satisfed, the deposits of each owner will be 

insured as that owner’s deposits. 

How does the FDIC insure funds deposited by a fduciary? 

Funds deposited by a fduciary on behalf of a person or entity (the 

owner) are insured as the deposits of the owner if the disclosure 

requirements for fduciary accounts are met. 

Are funds deposited by a fduciary insured separately from an owner’s 

other deposit accounts at the same bank? 

Funds deposited by a fduciary on behalf of a person or entity (the owner) 

are added to any other deposits the owner holds in the same ownership 

category at the same bank, and insured up to the applicable limit. 

For Example: A broker purchases a CD for $250,000 on a customer’s 

behalf at ABC Bank. The customer already has a checking account in 

his or her name at ABC Bank for $15,000. The two accounts are added 

together and insured up to $250,000 in the single ownership account 

category. Since the customer’s single ownership deposits total $265,000, 

$15,000 is uninsured. 

HEALTH SAVINGS ACCOUNTS 

What is a Health Savings Account? 

A Health Savings Account (HSA) is an IRS qualifed tax-exempt trust or 

custodial deposit that is established with a qualifed HSA trustee, such 

as an FDIC-insured bank, to pay or reimburse a depositor for certain 

medical expenses. 

How does the FDIC insure an HSA? 

An HSA, like any other deposit, is insured based on who owns the funds 

and whether benefciaries have been named. If a depositor opens an 

HSA and names benefciaries either in the HSA agreement or in the 

bank’s records, the FDIC would insure the deposit under the Revocable 

Trust Account ownership category. If a depositor opens an HSA and 

does not name any benefciaries, the FDIC would insure the deposit 

under the single account ownership category. 

26 27 
How should an HSA be titled? 

The identifcation of a deposit as an HSA, such as “John Smith’s HSA,” 

is suffcient for titling the deposit to be eligible for single account or 

revocable trust account coverage, depending on whether eligible 

benefciaries are named. 

MORTGAGE SERVICING ACCOUNTS 

How are Mortgage Servicing Accounts Insured? 

Mortgage Servicing Accounts are accounts maintained by a mortgage 

servicer, in a custodial or other fduciary capacity, which are composed 

of payments by mortgagors of principal and interest (P&I). 

The cumulative balance paid into the account by the mortgagors 

is insured, with coverage provided to the mortgage servicer or 

mortgage investor, for up to $250,000 per mortgagor (the borrower). 

The calculation of coverage for each P&I account is separate if the 

mortgage servicer or mortgage investor has established multiple P&I 

accounts in the same bank. 

For example, a mortgage servicer collects from 1,000 different borrowers 

their monthly mortgage payments of $2,000 (P&I) and places the funds 

into a mortgage servicing account. Is the $2,000,000 aggregate balance of 

the mortgage servicer’s mortgage servicing account insured? 

Yes, the account is fully insured to the mortgage servicer because each 

mortgagor’s payment of $2,000 (P&I) is insured separately for up to 

$250,000. 

Although mortgage servicers often collect and escrow tax and insurance 

(T&I), these accounts are separately maintained and not considered 

mortgage servicing accounts for deposit insurance purposes. T&I 

deposits belong to the mortgagors pending payment of their real estate 

taxes and/or property insurance premium to the taxing authority or 

insurance company. The T&I deposits are insured on a “pass-through” 

basis to each individual mortgagor. 

COVERDELL EDUCATION SAVINGS ACCOUNTS 

How is a Coverdell Education Savings Account insured? 

A Coverdell Education Savings Account is insured as an irrevocable 

trust account. Although this account is often referred to as an Education 

IRA, the account does not involve retirement and is therefore not 

insured as a self-directed retirement account. It is an irrevocable 

commitment created for the purpose of paying qualifed education 

expenses of a designated benefciary. 

FREQUENTLY ASKED QUESTIONS 

BANK CHANGES 

What happens to my deposits if my bank fails? 

In the unlikely event of a bank failure, the FDIC acts quickly to protect 

insured deposits by arranging a sale to a healthy bank, or by paying 

depositors directly for their deposit accounts to the insured limit. 

• Purchase and Assumption Transaction: This is the preferred and 

most common method, under which a healthy bank assumes the 

insured deposits of the failed bank. Insured depositors of the failed 

bank immediately become depositors of the assuming bank and have 

access to their insured funds. The assuming bank may also purchase 

loans and other assets of the failed bank. 

It is important for account owners to note that their deposit contract 

was with the failed bank and is considered void upon the failure of the 

bank. The assuming institution has no obligation to maintain either the 

failed bank rates or terms of the account agreement. Depositors of 

a failed bank, however, do have the option of either setting up a new 

account with the acquiring institution or withdrawing some or all of 

their funds without penalty. 

28 29 
• Deposit Payoff: When there is no open bank acquirer for the 

deposits, the FDIC will pay the depositor directly by check up to 

the insured balance in each account. Such payments usually begin 

within a few days after the bank closing. 

What happens to my insurance coverage if I have deposits at two 

insured banks that merge? 

When two or more insured banks merge, deposits from the assumed 

bank are separately insured from deposits at the assuming bank for at 

least six months after the merger. This grace period gives a depositor 

the opportunity to restructure his or her accounts, if necessary. 

CDs from the assumed bank are separately insured until the earliest 

maturity date after the end of the six-month grace period. CDs that 

mature during the six-month period and are renewed for the same 

term and in the same dollar amount (either with or without accrued 

interest) continue to be separately insured until the frst maturity date 

after the six-month period. If a CD matures during the six-month grace 

period and is renewed on any other basis, it would be separately 

insured only until the end of the six-month grace period. 

Note that in situations of a bank failure where a depositor already has 

deposits at the acquiring bank, the six-month grace period described 

would also apply to their deposits. 

DEATH OF ACCOUNT OWNERS AND BENEFICIARIES 

What happens to insurance coverage after an account owner dies? 

The FDIC insures a deceased person’s accounts as if the person were 

still alive for six months after the death of the account holder. During 

this grace period, the insurance coverage of the owner’s accounts will 

not change unless the accounts are restructured by those authorized to 

do so. Also, the FDIC will not apply this grace period if it would result in 

less coverage. 

How does the death of a benefciary of an informal revocable trust 

(e.g., POD account) affect insurance coverage? 

There is no grace period if the benefciary of a POD account dies. In 

most cases, insurance coverage for the deposits would be reduced 

immediately. 

For example: A mother deposits $500,000 in a POD account at an insured 

bank with her two children named as the benefciaries in the account 

records of the bank. While the owner and both benefciaries are alive, 

the account is insured up to $500,000 ($250,000 times two benefciaries 

= $500,000). If one benefciary dies, insurance coverage for the mother’s 

POD account is immediately reduced to $250,000 ($250,000 times one 

benefciary = $250,000). 

How does the death of a benefciary of a formal revocable trust affect 

the insurance coverage? 

Like informal revocable trusts, the six-month grace period does not 

apply to the death of a benefciary named in a formal revocable trust 

account. However, the terms of the formal revocable trust may provide 

for a successor benefciary or some other redistribution of the trust 

deposits. Depending on these terms, the insurance coverage may or 

may not change. 

30 31 
NOTES 

32 33 
FORMOREINFORMATION 

FROM THE FDIC

Call toll-free 

1-877-ASK-FDIC (1-877-275-3342)

Hearing impaired line 

1-800-925-4618

Calculate insurance coverage 

Use the FDIC’s online Electronic Deposit Insurance Estimator (EDIE) at: 

https://edie.fdic.gov 

Read more about FDIC insurance online 

at: www.fdic.gov/deposit/deposits 

View frequently asked questions on deposit insurance coverage at: 

www.fdic.gov/deposit/deposits 

Order FDIC deposit insurance products online 

at: https://catalog.fdic.gov

Send questions by e-mail 

Use the FDIC’s online Customer Assistance 

Form at: https://ask.fdic.gov/fdicinformationandsupportcenter/s/

Mail questions 

Federal Deposit Insurance Corporation 

Attn: Deposit Insurance Section 

550 17th Street, NW 

Washington, DC 20429 

FDIC-001-2014 (Large Print)