This tool is designed to estimate the extent to which deposits are protected by the Federal Deposit Insurance Corporation (FDIC). It operates by considering the ownership categories of accounts held at an insured bank and applying the FDIC’s coverage rules. For instance, if an individual holds a single account, a joint account with a spouse, and a trust account designating multiple beneficiaries, the calculation determines the insurable amount within each category up to the standard coverage limit.
Using such a resource offers several advantages. It assists individuals and businesses in understanding the level of protection afforded to their funds held in deposit accounts. This understanding is crucial for making informed decisions about where to deposit money and how to structure accounts to maximize coverage. The FDIC insurance program was established in response to bank failures during the Great Depression to restore public confidence in the banking system and protect depositors’ savings.
