Today, the FDIC covers up to $250,000 per account owner / ownership category at each insured bank. As of April 1, 2024, the FDIC has issued final regulations that will change how bank accounts held in the name of a trust will be insured. This rule change treats both revocable and irrevocable trust the same for determining the limits on insurance. Under the amendments, all trust deposits can receive a maximum of $1.25 million in FDIC coverage per trust account owner per bank regardless of whether the trust is revocable or irrevocable.
The current legal FDIC insurance limit is up to $250,000 per account owner/ownership category, per insured bank. This indicates individual and joint accounts can each receive $250,000 of insurance at an insured bank with a common account owner. As with individual accounts, business accounts can also get FDIC insurance of up to $250,000 per entity per bank. FDIC insurance extends to both the principal and accrued interest.
Does FDIC cover $500,000 on a joint account?
Yes, since an individual account and a joint account are considered separate ownership categories, each can receive up to $250,000 of FDIC insurance at the same insured bank. Therefore, a total of $500,000 can be covered when both account types are under a common account owner.
Does the FDIC insure $250,000 in multiple accounts?
Yes, the FDIC insures up to $250,000 per owner and category, per insured bank. So, multiple accounts held by the same owner in different categories (such as individual, joint, and certain types of business accounts) are each eligible for $250,000 in coverage.