Orlando Harmon
If you're considering joining a credit union, you may be wondering if your money will be insured. The short answer is yes—if you join a federally insured credit union, your money will be insured by the National Credit Union Administration (NCUA). Federally insured credit unions are required to display the official NCUA insurance sign at each teller station, where deposits are accepted, and on their website. The NCUA operates and manages the National Credit Union Share Insurance Fund (NCUSIF), which insures deposits of more than 135 million account holders in federal credit unions and most state-chartered credit unions. The NCUSIF provides up to $250,000 in coverage for each single ownership account and insures deposits dollar-for-dollar, including principal and any posted dividends. Credit union members don't need to take any extra steps to ensure their money is protected, as the insurance is provided automatically.
| Characteristics | Values |
|---|---|
| Money insured in credit union | Up to $250,000 per individual depositor |
| Who manages the insurance fund | The National Credit Union Administration (NCUA) |
| Who backs the insurance fund | The full faith and credit of the United States government |
| What accounts are covered | Single ownership accounts, joint ownership accounts, payable-on-death accounts, living trusts, IRAs, trust accounts |
| What accounts are not covered | Investment accounts, insurance policies, safe deposit boxes |
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What You'll Learn
The National Credit Union Share Insurance Fund
The NCUSIF provides up to $250,000 in coverage for each single ownership account. For jointly owned accounts, the NCUSIF insures an additional $250,000 for each account holder. The fund also separately protects IRA and KEOGH retirement accounts up to $250,000. Credit union members can use the NCUA's Share Insurance Estimator to calculate the amount of insured funds they have at a federally insured credit union. This tool can be used for personal, business, or government accounts, and is available on the NCUA's consumer website, MyCreditUnion.gov.
The NCUSIF is similar to the deposit insurance coverage provided by the Federal Deposit Insurance Corporation (FDIC). While accounts at credit unions and banks are insured differently, both federal agencies have similar rules and processes, and the same cap on how much of a depositor's funds are insured. The NCUA is responsible for managing and closing any credit unions that fail, and returning funds from accounts to their members. The funds are typically returned within five days of closure.
The NCUSIF is an important safeguard for credit union members, providing peace of mind that their deposits are protected up to the insured limit. With the backing of the United States government, the NCUSIF helps to ensure that credit unions are a safe and secure place for individuals to save their money.
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NCUA insurance coverage
The National Credit Union Administration (NCUA) is a US government agency that insures deposits at federally insured credit unions. The NCUA operates and manages the National Credit Union Share Insurance Fund (NCUSIF), which insures deposits of over 135 million account holders in all federal credit unions and most state-chartered credit unions.
The NCUSIF provides up to $250,000 in coverage for each single ownership account. This limit refers to the total of all shares that account owners have at each federally insured credit union. For jointly owned accounts, the NCUSIF insures an additional $250,000 for each account holder. This means that a joint savings account can be insured for up to $500,000, consisting of $250,000 for each account holder. The NCUA also separately protects IRA and KEOGH retirement accounts up to $250,000.
It is important to note that the NCUA does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities, or municipal securities, even if these investment or insurance products are sold at a federally insured credit union. Additionally, the NCUA does not insure safe deposit boxes or their contents, nor does it insure digital assets such as cryptocurrencies.
Credit union members do not need to apply for share insurance coverage, as it is provided automatically when they join a federally insured credit union. To confirm that a credit union is federally insured, members can visit the NCUA's Credit Union Locator tool.
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NCUA-insured vs. non-insured accounts
Federally insured credit unions offer a safe place for credit union members to save money. The National Credit Union Administration (NCUA) is the government agency that insures deposits at member credit unions. The NCUA operates and manages the National Credit Union Share Insurance Fund, which insures the deposits of over 135 million account holders in all federal credit unions and most state-chartered credit unions.
The NCUA's share insurance covers members' accounts at each federally insured credit union, including deposits in a share draft account, share savings account, or time deposit such as a share certificate. The insurance covers the principal and any accrued dividend through the date of the insured credit union's closing, up to the insurance limit. The NCUSIF covers up to $250,000 of the total balance of individuals' credit union accounts. For jointly owned accounts, the NCUSIF insures an additional $250,000 for each account holder.
NCUA share insurance does not cover all types of accounts. It does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities, or municipal securities, even if these investment or insurance products are sold at a federally insured credit union.
Credit unions that are not federally insured may be insured by private insurers. These private insurers provide non-federal share insurance coverage of deposits that are not backed by the full faith and credit of the United States government. As such, it is important for members to confirm that their credit union is federally insured. Federally insured credit unions are required to display the official NCUA insurance sign at each teller station and on their websites.
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Federally insured credit unions
The NCUA's Share Insurance Estimator helps consumers, credit unions, and their members understand the insurance rules that apply to member share accounts. It also helps them determine what is insured and what portion, if any, exceeds coverage limits. All deposits at federally insured credit unions are protected by the National Credit Union Share Insurance Fund, with deposits insured up to at least $250,000 per individual depositor. Credit union members have never lost insured savings at a federally insured credit union.
The NCUA also protects consumers and educates the public on consumer protection and financial literacy issues. The NCUA is the independent federal agency created by the US Congress to regulate, charter and supervise federal credit unions. The NCUA's counterpart to banks is the Federal Deposit Insurance Corporation (FDIC). While accounts at credit unions and banks are insured differently, both federal agencies have similar rules and processes, and even have the same cap on how much of a depositor's funds are insured.
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NCUA's role in reimbursing members
The National Credit Union Administration (NCUA) is an independent federal agency created by the US Congress to regulate, charter and supervise federal credit unions. The NCUA is the government agency that insures deposits at member credit unions. It operates and manages the National Credit Union Share Insurance Fund (NCUSIF), which insures the deposits of more than 135 million account holders in all federal credit unions and most state-chartered credit unions.
The NCUSIF guarantees money in a credit union’s account and is backed by the full faith and credit of the US government. It provides up to $250,000 in coverage for each single ownership account. The NCUA's role in reimbursing members is to manage and close the institution when a credit union fails. The NCUA’s Asset Management and Assistance Center liquidates the credit union and returns funds from accounts to its members. The funds are typically returned within five days of closure. The NCUA may use the liquidated funds to pay off any outstanding loans of the account holder.
The NCUA does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investment or insurance products are sold at a federally insured credit union. Credit unions are required to disclose that these products are not deposits or other obligations of the credit union and are not guaranteed by the credit union.
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Frequently asked questions
Federally insured credit unions offer a safe place for credit union members to save money. All deposits at federally insured credit unions are protected by the National Credit Union Share Insurance Fund, with deposits insured up to at least $250,000 per individual depositor.
The NCUA is the government agency that insures deposits at member credit unions. The NCUA’s counterpart to banks is the Federal Deposit Insurance Corporation (FDIC). The NCUA also protects consumers and educates the public on consumer protection and financial literacy issues.
The NCUSIF guarantees money in a credit union’s account and is backed by the full faith and credit of the U.S. government. The NCUSIF provides up to $250,000 in coverage for each single ownership account.
