Is Life Insurance Federally Insured? 
Life insurance is not federally insured by the FDIC -LRB- Federal Deposit Insurance Corporation -RRB- . The FDIC insures bank deposits . Life insurance is a contract between the policy owner and the life insurance company , and life insurance companies and contracts are regulated by state insurance commissions . In addition , states have guaranty funds to help offset loss if a life insurance company should leave policyholders in peril . 