Understanding FDIC Insurance Coverage
The FDIC Standard Maximum Deposit Insurance Amount (SMDIA) for deposits has been permanently increased to $250,000 per depositor per insured financial institution. The following special rules apply to noninterest-bearing transaction accounts:
NOTICE: By federal law, as of 1/1/2013, funds in a noninterest-bearing transaction account (including an IOTA) will no longer receive unlimited deposit insurance coverage, but will be FDIC- insured to the legal maximum of $250,000 for each ownership category. For more info, visit http://www.fdic.gov/deposit/deposits/unlimited/expiration.html
Coverage Over Basic Insurance
The FDIC provides separate insurance coverage for deposit accounts held in different categories of ownership. It is possible to qualify for more than the current $250,000 in coverage at one insured bank if you own deposit accounts in different ownership categories. The ownership categories are (1) single, (2) joint, (3) revocable trust (informal revocable trusts such as Payable-on-death accounts and formal revocable trusts such as living/family trusts created for estate planning purposes), (4) irrevocable trusts, (5) certain retirement plans, (6) employee benefit plans, (7) business (corporation, partnership, unincorporated associations), and (8) government.