FDIC Bank Insurance: Limits, Ownership Categories, and Exclusions

FDIC bank insurance coverage limits are set at $250,000 per depositor, per insured bank, for each ownership category. That figure has held since 2008 and remains the standard going into 2026. Coverage is automatic at any FDIC-insured bank, and by holding money in different ownership categories or at separate institutions, you can protect far more than $250,000 in total.¹

How the $250,000 Limit Is Counted

Federal law sets the standard maximum deposit insurance amount at $250,000, defined in the Federal Deposit Insurance Act.² Three variables control your actual coverage: who the depositor is, which bank holds the money, and what ownership category the account falls into.

Within a single ownership category at one bank, the FDIC adds everything together. A checking account with $50,000 and a savings account with $200,000, both in your name alone at the same bank, come to exactly $250,000 and are fully covered. Add a $25,000 CD in your name at that same bank and you’re at $275,000, with $25,000 uninsured. The limit applies to principal plus any interest accrued through the day the bank closes, so the real threshold is your combined balance on that date.³

A point that catches people off guard: different branches of the same bank count as one institution. Holding $200,000 at the downtown branch and $100,000 at a branch across town is $300,000 at one bank, not two separate deposits. To spread risk across institutions, you need accounts at entirely separate banks.⁴

Standard deposit products are covered: checking accounts, savings accounts, money market deposit accounts, CDs, and cashier’s checks or money orders the bank has issued. Every depositor at an insured bank is covered automatically. No application, no premium, no separate enrollment.¹

Ownership Categories That Push Coverage Past $250,000

Deposits held in different ownership categories at the same bank are insured separately, each up to $250,000.⁵ This is where a household can protect well over the base limit at a single institution.

Single Accounts

A single account is any deposit owned by one person without named beneficiaries. All single accounts you hold at the same bank are added together and insured up to $250,000. Individual checking, savings, and CDs titled only in your name fall here.¹

Joint Accounts

Each co-owner of a joint account is insured up to $250,000 for their share of all joint accounts at the same bank, with equal ownership assumed unless bank records say otherwise. A couple with a $500,000 joint account is fully covered, $250,000 attributed to each person. That joint coverage sits apart from what each spouse holds individually, so the same couple could also each hold $250,000 in single accounts at the same bank and still be fully insured.⁶

Retirement Accounts

Traditional, Roth, SEP, and SIMPLE IRAs occupy their own ownership category. All IRA deposits you hold at the same bank are combined and insured up to $250,000, separate from your other accounts. Adding beneficiaries to an IRA does not raise the limit. A $100,000 Roth IRA and a $180,000 traditional IRA at the same bank form one $280,000 pool: $250,000 covered, $30,000 uninsured.⁷

Trust Accounts

Trust accounts offer some of the highest coverage available. The FDIC insures trust deposits at $250,000 per eligible beneficiary, capped at $1,250,000 per trust owner once five or more beneficiaries are named. The formula: number of owners × number of beneficiaries × $250,000, up to that $1,250,000 ceiling per owner. Three beneficiaries produce $750,000 in coverage. Seven beneficiaries still stop at $1,250,000, because beneficiaries beyond five don’t add coverage.⁸

All deposits a single owner holds in informal revocable trusts (like payable-on-death accounts), formal revocable trusts, and irrevocable trusts at the same bank are combined for insurance purposes. Opening multiple trust accounts at one bank with the same beneficiaries does not stack additional coverage.⁸

Business Accounts

Deposits held by a corporation, partnership, LLC, or unincorporated association are insured up to $250,000, separate from the personal deposits of the owners or officers. The business must be engaged in a legitimate independent activity, not a shell created solely to increase coverage. Different divisions or departments of the same entity don’t get separate coverage. Separately incorporated subsidiaries running their own operations do qualify for their own $250,000, apart from the parent. Sole proprietorships and DBAs receive no separate treatment; those deposits are grouped with the owner’s personal single accounts.⁹

Employee Benefit Plan Accounts

Employer-sponsored plans such as 401(k)s that place deposits at an insured bank receive pass-through coverage of up to $250,000 per participant for that participant’s non-contingent interest. Coverage passes through the plan to each employee based on their balance as of the date of the bank’s failure.⁵

What FDIC Insurance Does Not Cover

FDIC insurance covers deposit products only. Investment products sold through a bank, including at a teller window inside a branch, carry market risk and are not protected against loss. Products outside FDIC coverage include:¹

Stocks and bonds
Mutual funds
Annuities and life insurance policies
Municipal securities
U.S. Treasury bills, bonds, or notes (backed by the federal government’s own guarantee, but not by FDIC insurance)
Crypto assets

Cryptocurrency and stablecoins deserve a specific mention. Even when a crypto platform partners with an FDIC-insured bank, the crypto assets themselves are not insured deposits. Federal law now explicitly prohibits stablecoin operators from advertising that their tokens carry FDIC deposit insurance protection.

Safe deposit box contents are also outside the FDIC’s scope. A safe deposit box is a storage service. Cash, jewelry, or documents kept inside are not insured against theft or damage.¹⁰

Brokerage Sweep Accounts

Many brokerage firms sweep uninvested cash into partner banks and advertise FDIC coverage. That coverage can be legitimate, but only if the funds are actually owned by you (not by the broker), the bank’s records reflect the custodial nature of the account, and records identify you as the beneficial owner along with your ownership interest. When all three conditions are met, you receive pass-through insurance at $250,000 per ownership category at each partner bank. When they aren’t, the entire pool may be insured only to the broker as a single depositor: $250,000 total for all customers combined.¹¹

How to Verify Your Bank and Calculate Your Exposure

Not every institution that looks like a bank is FDIC-insured, and fintech apps that offer banking features sometimes are not banks. Two free FDIC tools let you check:

BankFind: The FDIC’s BankFind Suite lets you search by institution name, website, or FDIC certificate number to confirm a bank is currently insured. Filter results to “Active” status.¹²
EDIE Calculator: The Electronic Deposit Insurance Estimator walks you through your accounts at a single bank and calculates how much is insured and how much is exposed. Enter your accounts for one bank, generate the report, then repeat for each bank where you hold deposits.¹³

FDIC-insured banks are required to display an official FDIC sign at physical branches, and updated rules will extend that sign to bank websites, mobile apps, and ATM screens starting in 2027.¹⁴

What Happens if Your Insured Bank Fails

Bank failures are uncommon, but they happen. The FDIC steps in as receiver and works to get insured depositors their money quickly. You do not file a claim. The FDIC uses the bank’s own records to determine your balances and coverage.

The FDIC’s stated goal is to make insurance payments within two business days of the bank’s closing.¹⁵ In most failures, a healthy bank takes over the failed bank’s deposits and your accounts transition to the new institution with little interruption. When no acquirer steps in, the FDIC pays insured depositors directly, generally by the next business day. Coverage includes principal and interest accrued through the closing date; interest stops accruing then.³

Amounts above the $250,000 limit are not automatically lost, but they are not guaranteed either. The FDIC sells off the failed bank’s assets over time and distributes proceeds to uninsured depositors on a pro-rata basis. Payments trickle in periodically, and the process can take years. Final recovery depends on what the bank’s loan portfolio and other assets actually bring.⁴

When a Depositor Dies

After a deposit owner’s death, the FDIC provides a six-month grace period during which the deceased person’s accounts continue to be insured as if the owner were still alive. If accounts aren’t restructured within that window, the FDIC starts calculating insurance based on actual ownership, which usually means the funds fold into the heir’s or estate’s own coverage limits.⁵ Funds held in a decedent account managed by an executor are treated as the deceased person’s single-account deposits and insured up to $250,000. Once the executor distributes money to heirs, each heir needs to check their own coverage: if the inheritance pushes their balance past $250,000 at the same bank, the excess is uninsured.¹⁶

Credit Unions Are Insured Separately

If you bank at a credit union, the FDIC does not cover your deposits. The National Credit Union Administration does, through the Share Insurance Fund, at $250,000 per depositor at federally insured credit unions with the same per-institution, per-ownership-category structure. Nearly all federal credit unions and the vast majority of state-chartered credit unions carry this coverage. The protection is identical in amount; only the insuring agency differs.

1
FDIC.gov. Understanding Deposit Insurance
2
Office of the Law Revision Counsel. 12 USC 1821 – Insurance Deposits
3
FDIC.gov. When a Bank Fails – Facts for Depositors, Creditors, and Borrowers
4
FDIC.gov. Deposit Insurance FAQs
5
eCFR. 12 CFR Part 330 – Deposit Insurance Coverage
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FDIC.gov. Financial Institution Employees Guide to Deposit Insurance – Joint Accounts
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FDIC.gov. Certain Retirement Accounts
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FDIC.gov. Trust Accounts
9
FDIC.gov. Corporation, Partnership and Unincorporated Association Accounts
10
Federal Deposit Insurance Corporation. Five Things to Know About Safe Deposit Boxes, Home Safes and Your Valuables
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FDIC.gov. Pass-through Deposit Insurance Coverage
12
FDIC. BankFind Suite – Find Insured Banks
13
FDIC. Electronic Deposit Insurance Estimator (EDIE) – Calculator
14
Federal Register. FDIC Official Signs, Advertisement of Membership, False Advertising, Misrepresentation of Insured Status, and Misuse of the FDICs Name or Logo
15
FDIC.gov. Payment to Depositors
16
FDIC.gov. Financial Institution Employees Guide to Deposit Insurance – Single Accounts