Personal Insights

What is the FDIC and what does it do?

You always want to make sure that your money is protected, and the easiest way to do that is to use a bank that is FDIC insured, like Regions. The Federal Deposit Insurance Corporation (FDIC) is a government agency that provides insurance coverage to depositors like you. FDIC insurance covers a range of deposit accounts, but it’s important to know exactly how much coverage you can get.

The FDIC provides insurance coverage of up to $250,000 per depositor per bank, per account ownership category. This means that if you have multiple accounts with the same bank, your insurance coverage will be calculated separately for each account type and ownership category. Coverage can be calculated differently depending on the number of people on the account and the type of account you have.

Is FDIC insurance free?

Yes, FDIC insurance is automatic and free for Regions customers. You do not need to sign up, opt in or pay anything for your deposit account to be insured.

What types of deposit accounts are included?

Single accounts

A single account is an account owned by one person. This can include checking accounts, savings accounts, CDs and money market accounts. FDIC insurance covers up to $250,000 for a single account.

Joint accounts

A joint account is an account owned by two or more people. Each owner’s share of the account is insured up to $250,000. For example, if you have a joint savings account with your spouse, each of you is insured up to $250,000, which means that the account is insured for up to $500,000.

Retirement Accounts

FDIC deposit insurance covers retirement deposit accounts in which plan participants have the right to direct how the money is invested. These accounts include:

• Individual retirement accounts (IRAs)
• Self-directed defined contribution plans, such as a 401(k) or profit-sharing plan
• Self-directed Keogh plan accounts
• Section 457 deferred compensation plan accounts, whether self-directed or not

Coverage limit: All retirement deposit accounts listed above owned by the same person at the same bank are added together and insured up to $250,000.

Trust accounts

Both revocable and irrevocable trust deposit accounts are insured up to $250,000 per owner, per beneficiary, per account. This means that if you have a trust account with multiple beneficiaries, each beneficiary is insured up to $250,000 for that account.

Employee benefit deposit accounts

An employee benefit plan account – such as a pension plan, defined benefit plan or other employee benefit plan – is an account where investment decisions are made by a plan administrator (not by the participants). The interests of each participant’s noncontingent interest under the plan is insured up to $250,000 per bank. For plans where the interests are contingent, such as health and welfare plans, the coverage is $250,000 for the plan itself.

Business deposit accounts

Corporation, partnership and unincorporated association accounts are accounts established by businesses and organizations. FDIC insurance covers deposits up to $250,00 for these accounts, which are insured separately from the personal accounts of stockholders, partners and members. To qualify for this coverage, the entity must be engaged in an independent activity, meaning that the entity is operated primarily for some purpose other than to increase deposit insurance. Separate accounts owned by the same entity but designated for different purposes are not separately insured.

Note that deposits owned by a business that is a sole proprietorship are not insured under this category.

What accounts are covered by FDIC insurance?

FDIC insurance covers a wide range of deposit accounts, including:

• Checking accounts
• Savings accounts
• Certificates of deposit (CDs)
• Money market accounts
• Negotiable order of withdrawal (NOW) accounts
• Official checks and money orders issued by a bank
• Prepaid cards (assuming certain FDIC requirements are met)

However, not all types of accounts are covered by FDIC insurance. The following accounts are not covered:

• Stocks, bonds and mutual funds
• Life insurance policies
• Annuities
• Crypto assets
• Municipal securities
• Safe deposit boxes

Maximizing your FDIC insurance coverage

Maximizing your FDIC insurance coverage is important if you hold more than $250,000. There are a number of strategies you can take. A Regions Financial Advisor is equipped to help you understand your options and create a plan that helps you maximize your coverage, like spreading your money across different ownership categories or investing in FDIC-insured products like CDs or interest-bearing money market accounts.

More information can be found online at the FDIC website, fdic.gov/resources/deposit-insurance, including an insurance coverage calculator, edie.fdic.gov/calculator.html.

If you have additional questions, your Regions Banker is always happy to sit down with you to discuss your particular needs