|
|
FDIC Coverage of Accounts
The FDIC (Federal Deposit Insurance Corporation) was established by the U.S. Congress in 1933 with a charter to insure bank deposits, maintain sound conditions in the banking system, and protect the nation's money supply in case of bank failures. Since the start of the FDIC on January 1, 1934, no depositor has lost a single penny of insured deposits as a result of a failure.
The FDIC insures all deposit account types at insured banks, including checking, interest checking, savings, money markets and CDs, up to the insurance limit.
The FDIC however does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities, or municipal securities, even if they are purchased from an insured bank. (Certain money market mutual funds are covered by a separate program under the U.S. Treasury. Please visit www.USTreas.gov for additional information.) In addition, the contents of safe deposit boxes are also not covered by deposit insurance.
TD Banknorth and TD Bank are chartered as one bank - TD Bank, N.A. FDIC insurance coverage limits apply to the combined accounts in TD Bank, N.A. (TD Banknorth and TD Bank). Accounts held in different states at TD Bank, N.A. are not insured separately.
Insurance Limit Amounts
On May 20, 2009, President Barack Obama signed the Helping Families Save Their Homes Act, extending the temporary increase in the standard maximum deposit insurance amount to $250,000 per depositor through December 31, 2013.
Certain retirement accounts, such as Individual Retirement Accounts, will remain insured up to $250,000 per depositor per insured bank after December 31, 2013.
The extension of the increase in the FDIC deposit insurance limit to $250,000 announced on May 20, 2009 does not apply to the FDIC Transaction Account Guarantee Program. The FDIC Transaction Account Guarantee Program provides full deposit insurance coverage for all funds in non-interest-bearing transaction deposit accounts for participating institutions through December 31, 2009. This insurance coverage is over and above the $250,000 in coverage currently provided by the FDIC.
Learn more about the FDIC Transaction Account Guarantee Program.
Common Ownership Categories
The FDIC provides separate insurance coverage for deposit accounts held in different categories of ownership. You may qualify for more than $250,000 in coverage at one insured bank if you own deposit accounts in different categories.
Individual Accounts
Individual accounts are accounts owned by one person and titled in that person's name only. All individual accounts at the same insured bank are added together and the total is insured up to $250,000, with the exception of non-interest-bearing transaction accounts which are separately insured for the full amount. For example, if you have an interest-bearing checking account and a CD at the same insured bank, and both accounts are in your name only, the two accounts are added together and the total is insured up to $250,000.
Individual accounts include:
- Single ownership accounts
- Sole proprietorship accounts
- Agent, custodian, conservator accounts
- UTMA accounts
- Estate accounts
Joint Accounts
In addition to individual insured accounts, each person is entitled to a maximum of $250,000 coverage for interest-bearing deposits in all of his/her joint accounts. If a couple has a joint interest-bearing checking account and a joint savings account at the same insured bank, each co-owner's shares of the two accounts are added together and insured up to $250,000, providing up to $500,000 in coverage for the couple's joint accounts.
Retirement Accounts
Certain retirement accounts are separately insured from any other deposits a Customer may have at the same institution. These are deposit accounts owned by one person and titled in the name of that person's retirement plan. Only the following types of retirement plans are insured in this ownership category:
- Individual Retirement Accounts (IRAs) including traditional IRAs, Roth IRAs, Simplified Employee Pension (SEP) IRAs, and Savings Incentive Match Plans for Employees (SIMPLE) IRAs
- Section 457 deferred compensation plan accounts (whether self-directed or not)
- Self-directed defined contribution plan accounts
- Self-directed Keogh plan (or H.R. 10 plan) accounts
All deposits that an individual has in any of the types of retirement plans listed above at the same insured bank are added together and the total is insured up to $250,000. For example, if an individual has an IRA and a self-directed Keogh account at the same bank, the deposits in both accounts would be added together and insured up to $250,000.
Please note: Naming beneficiaries on a retirement account does not increase deposit insurance coverage.
Revocable Trust Accounts (Testamentary, Payable on Death or ITF)
The bank offers In Trust For (ITF) accounts. This type of account signifies the intention that the funds will belong to a named beneficiary on the death of the owner (grantor or depositor) of the account.
Funds deposited into revocable trust accounts, whose beneficiaries are a natural person, or a charity, or other non-profit organization, are separately insured to $250,000 per beneficiary (in addition to the insurance on valid individual joint and non-interest-bearing transaction accounts). They provide that, at the death of the owner, funds will pass to a named beneficiary.
Determining coverage for living trust accounts (a type of Revocable Trust Account) can be complicated and requires more detailed information about the FDIC's insurance rules than can be provided here. If you have a living trust account, contact the FDIC at 877-275-3342 for more information.
Business Accounts
In general, business accounts receive $250,000 in FDIC insurance. This includes municipalities.
Please note, however, that funds owned by a business that is a sole proprietorship are NOT insured under this category. Rather, they are insured as the single account funds of the person who is the sole proprietor. So, funds deposited in the sole proprietorship's name are added to any other single accounts of the sole proprietor and the total is insured to a maximum of $250,000 in interest-bearing accounts.
A Sample Scenario
Account Holders & Owners |
Ownership Category |
Product |
Product Type |
Balance |
Amount Insured |
Uninsured Amount |
John Smith |
Single Account |
Checking |
Interest-bearing |
$125,000 |
$125,000 |
N/A |
John Smith |
Single Account |
Savings |
Interest-bearing |
$125,000 |
$125,000 |
N/A |
John & Mary Smith |
Joint Account |
CD |
Interest-bearing |
$520,000-Total
$260,000-John
$260,000-Mary |
$500,000 |
$20,000 |
Mary Smith |
Retirement Account |
IRA |
Interest-bearing |
$300,000 |
$250,000 |
$50,000 |
|
Subtotal |
$1,070,000 |
$1,000,000 |
$70,000 |
|
John Smith |
Single Account |
Business Checking |
Non-interest-bearing |
$350,000 |
$350,000* |
N/A |
John & Mary Smith |
Joint Account |
Checking |
Non-interest-bearing |
$170,000 |
$170,000* |
N/A |
|
Subtotal |
$520,000 |
$520,000 |
N/A |
|
| |
Total |
$1,590,000 |
$1,520,000 |
$70,000 |
*Unlimited FDIC deposit insurance provided through December 31, 2009. Standard FDIC deposit insurance limits will apply after December 31, 2009.
For more information about FDIC coverage, visit the FDIC website at www.FDIC.gov or access the Electronic Deposit Insurance Estimator (EDIE the Estimator), an online tool that provides customized information about your insured accounts. The estimator is located at http://myfdicinsurance.gov. You may also call toll-free 877-ASK-FDIC for assistance.
To learn more, call Customer eCare or send us an e-mail.
TD Bank, N.A. is participating in the FDIC's Transaction Account Guarantee Program. Under that program, through December 31, 2009, all noninterest-bearing transaction accounts are fully guaranteed by the FDIC for the entire amount in the account. Coverage under the Transaction Account Guarantee Program is in addition to and separate from the coverage available under the FDIC's general deposit insurance rules.
Learn more about the FDIC Transaction Account Guarantee Program.
|
 |
