Changes in FDIC Deposit Insurance Coverage
April 1, 2024
The FDIC amended its regulations governing deposit insurance coverage. The amendments simplify the deposit insurance regulations by establishing a "trust accounts" category that governs coverage of deposits of Payable on Death (POD/ITF) accounts, formal revocable trusts and irrevocable trusts using a common calculation.
Coverage for deposits in this category will be calculated through a simple calculation. Each owner's trust deposits will be insured up to $250,000 multiplied by the number of trust beneficiaries up to a maximum of $1,250,000 per bank. The amendments will:
- Provide depositors and bankers with a rule for trust accounts coverage that is easy to understand; and
- Facilitate the prompt payment of deposit insurance in accordance with the Federal Deposit Insurance Act (FDI Act).
| Maximum Insurance Coverage per Trust Owner: | |
|---|---|
| Number of Unique Beneficiaries | Maximum Deposit Insurance Coverage |
| 1 Beneficiary | $250,000 |
| 2 Beneficiaries | $500,000 |
| 3 Beneficiaries | $750,000 |
| 4 Beneficiaries | $1,000,000 |
| 5 or more Beneficiaries | $1,250,000 |
Do the new trust rules affect me?
If the answer is yes to either or both of the following questions, the new trust rules will impact you, otherwise they do not.
- Do you as the owner or co-owner of a deposit account(s) with beneficiaries (excluding IRAs) have one or more revocable trust deposit(s) (either POD and/or a formal trust account) and an irrevocable trust account at the same bank?
- Do you as the owner or co-owner of a deposit account(s) with beneficiaries (excluding IRAs) have one or more accounts with a combined total balance of more than $1,250,000 for a single owner or $2,500,000 for two owners?
Important: The above changes do not apply to deposit accounts for irrevocable trusts with a bank acting as trustee or for court-ordered trusts.
Consumers and bankers can find additional information regarding FDIC's deposit insurance coverage through the deposit insurance publications located on the FDIC's deposit insurance homepage. In addition, you can call the FDIC at 1-877-ASK-FDIC (1-877-275-3342).