Yes, FDIC insurance covers savings accounts up to $250,000 per depositor, per bank

The Federal Deposit Insurance Corporation (FDIC) protects money you keep in a savings account at a bank that participates in the program. If the bank fails, the FDIC pays you back up to $250,000. This limit applies per depositor, per bank — so if you have $300,000 in savings at one bank, only $250,000 is covered. The remaining $100,000 is not protected.

The coverage is automatic. You do not need to sign up, pay a fee, or do anything special. If your bank is FDIC-insured (which most banks are), your savings account is covered from the moment you open it. You can check whether your bank participates by searching the FDIC's Bank Find tool on their website.

Coverage applies to the account balance as it stands on the day the bank closes. If your account earns interest, that interest is included in the $250,000 limit — it does not add to it.

Key Takeaways

  • FDIC insurance covers up to $250,000 per depositor per bank, and this limit includes any interest your account has earned.
  • The coverage is automatic at FDIC-insured banks; you do not need to register or pay for it.
  • If you have more than $250,000 at one bank, the amount over that limit is not covered and you lose it if the bank fails.
  • Spreading money across multiple banks or using joint accounts can increase the total amount covered, because each account type and each bank counts separately.
  • Credit unions use a similar but separate system called NCUA insurance, which also covers up to $250,000 per depositor.

How the $250,000 limit works across different account types

The $250,000 limit is per depositor, per bank, per account type. This means you can have more than $250,000 covered at a single bank if the money is in different account categories. A single savings account and a money market account at the same bank are counted separately, so you could have $250,000 covered in each one.

Joint accounts are also counted separately. If you and your spouse each have $250,000 in individual savings accounts at the same bank, both are fully covered. If you have a joint savings account with your spouse, that account is covered up to $250,000 total — split between you as co-owners. The FDIC divides joint account coverage equally unless the account documents specify otherwise.

Retirement accounts (IRAs, SEP-IRAs, and similar) are insured separately from regular savings accounts. You can have $250,000 covered in a traditional IRA and another $250,000 covered in a regular savings account at the same bank.

What happens if your bank fails

When an FDIC-insured bank closes, the FDIC steps in as the insurer, not as a replacement bank. The agency does not take over the bank's operations. Instead, it either arranges for another bank to buy the failed bank's deposits, or it pays depositors directly.

If another bank acquires the failed bank, your account may transfer automatically to the new bank with no action required on your part. You keep your account number and access to your money. If the FDIC pays you directly, you receive a check or electronic transfer within a few business days. The FDIC has never missed a important date on a payout.

The process is faster than most people expect. In recent bank failures, depositors with covered balances had access to their money within one to three business days. Amounts over $250,000 are handled separately and may take longer, but the covered portion is prioritized.

Amounts over $250,000 and how to protect them

Money above the $250,000 limit at a single bank is not covered by FDIC insurance. If you have $350,000 in a savings account and the bank fails, you lose $100,000. This is a real risk, not a theoretical one — it happens to depositors every time a bank closes.

The most straightforward way to protect money above $250,000 is to spread it across multiple FDIC-insured banks. If you have $500,000, you could keep $250,000 at Bank A and $250,000 at Bank B, and both amounts would be fully covered. You can open accounts at as many banks as you need.

Some people use services that automatically move money between multiple banks to keep each account under $250,000, but this adds complexity and fees. For most people, opening accounts at two or three different banks is simpler and costs nothing.

What FDIC insurance does not cover

FDIC insurance covers the balance in your account, but it does not cover losses from fraud, theft, or your own mistakes. If someone steals your debit card and empties your account, the FDIC does not reimburse you — your bank's fraud protection does. If you send money to a scammer, the FDIC does not recover it.

FDIC insurance also does not cover investment products held at a bank, such as stocks, bonds, mutual funds, or brokerage accounts. If your bank has a brokerage division and you buy stocks through it, those stocks are not FDIC-insured. Money in a bank's brokerage account is protected by a different system (SIPC insurance), which has different limits and rules.

Safe deposit boxes are not covered. If you keep cash, jewelry, or documents in a safe deposit box at an FDIC-insured bank and the bank fails, the FDIC does not reimburse you for the contents. Safe deposit boxes are your responsibility.

FDIC coverage for different savings account types

Standard savings accounts, money market accounts, and certificates of deposit (CDs) are all covered by FDIC insurance up to $250,000 each. A high-yield savings account at an FDIC-insured bank is covered the same way as a regular savings account. The interest rate does not change the coverage.

Checking accounts are also covered. Many people think FDIC insurance applies only to savings accounts, but it covers checking accounts, money market accounts, and CDs equally. The account type does not matter — the limit is $250,000 per depositor per bank per account category.

Sweep accounts (accounts that automatically move money between checking and savings) are treated as a single account for FDIC purposes. The total balance across both parts counts toward the $250,000 limit.

How to verify your bank is FDIC-insured

You can search the FDIC's Bank Find tool on the FDIC website to confirm your bank is insured. Enter your bank's name and state, and the tool shows you the bank's FDIC certificate number and coverage details. If your bank does not appear in the search results, it is not FDIC-insured.

Most traditional banks are FDIC-insured, but some online banks, credit unions, and alternative financial institutions are not. Credit unions are insured by the National Credit Union Administration (NCUA), which operates a similar but separate system. Online banks are usually FDIC-insured, but you should verify before opening an account with a new provider.

Your bank is required to display FDIC insurance signage in the lobby and on account statements. If you do not see it, ask a teller or check your account documents. The bank should tell you clearly whether your account is covered.

Frequently Asked Questions

If I have $300,000 in a savings account, how much is covered?

Only $250,000 is covered. The remaining $100,000 is not protected by FDIC insurance. If the bank fails, you lose the $100,000. To protect the full amount, you would need to split it between two banks or use a joint account with another person.

Does FDIC insurance cover money I lose to fraud or a scam?

No. FDIC insurance covers bank failure only, not fraud or theft. If someone steals your account information or you send money to a scammer, contact your bank's fraud department and file a report with the Federal Trade Commission. Your bank may reverse the transaction under its own fraud protection policies, but the FDIC does not cover these losses.

Are online banks covered by FDIC insurance?

Most online banks are FDIC-insured, but not all. Search the FDIC Bank Find tool to confirm your online bank is covered before opening an account. Online banks that are FDIC-insured have the same $250,000 limit as traditional banks.

What if I have accounts at two different branches of the same bank?

Branches do not matter for FDIC purposes. All accounts at the same bank are covered under one $250,000 limit per account type, regardless of how many branches you use. If you have $150,000 at one branch and $150,000 at another branch of the same bank, the total is $300,000 — only $250,000 is covered.

Does FDIC insurance cover my IRA?

Yes, but under a separate $250,000 limit. Your IRA is covered up to $250,000, and your regular savings account is covered up to another $250,000 at the same bank. The two accounts are counted separately for insurance purposes.