Share
Insurance
The shares in your credit union are insured by the National Credit Union Share
Insurance Fund (NCUSIF), an arm of NCUA. Established
by Congress in 1970 to insure member share accounts
at federally insured credit
unions, the NCUSIF is managed by NCUA under the
direction of the three-person NCUA Board. Your
share insurance is similar to the deposit
insurance protection offered by the Federal Deposit
Insurance Corporation (FDIC). The NCUA Share
Insurance Estimator is an educational resource about share insurance and gives a detailed explanation
of insurance coverage.
Credit unions insured by the NCUSIF must display in their offices
the official NCUA insurance sign. All federal credit
unions must be insured by NCUSIF, and no credit
union may terminate its federal
insurance without first notifying its members.
Here are some important facts to remember about your
share insurance:
The NCUSIF has several
programs to help insured credit unions that may
be experiencing problems, and liquidations or failures
are usually done only as a last resort.
If a federally insured credit union does fail,
however, the NCUSIF will make any necessary payout
to the credit union’s members. These
payouts are usually done within two days from the
time the credit union closes its doors.
Insured credit unions are required to deposit and
maintain one percent of their insured shares and deposits in the
NCUSIF. Historically, deposit insurance funds strive for a ratio
of equity to insured savings of at least one percent. The NCUSIF
ratio of equity to insured shares and deposits is normally 1.25 percent
to 1.30 percent.
As a member of an insured credit union, you do not
pay directly for your share insurance protection.
Your credit union pays into the NCUSIF a deposit
and an insurance assessment based
on the total amount of insured shares and deposits
in the credit union.
Properly established share accounts in federally
insured credit unions are insured up to $100,000.
Generally, if a credit union member has more
than one account in the same credit
union, those accounts are added together and
insured up to $100,000. There are exceptions.
You may obtain additional insurance coverage on
multiple accounts, if
you have different ownership interests or rights
in different types of
accounts and you properly
complete account forms and applications. For
example, if you have a regular share account
and an Individual IRA account at the same
credit union, each account is insured up to
$100,000. However, if you have a regular share
account, share certificate account
and share draft account, all in your own name,
you will not have
additional coverage. Those accounts will be
added together and insured up to $100,000 as your
individual account.
Additional coverage is available on revocable trust
or payable on death accounts. You can now name a parent or sibling
as a beneficiary to get separate coverage. Previously, beneficiaries
had to be a spouse, child or grandchild. The rules on joint accounts
have been simplified. A co-owner’s interest in all joint accounts
in the same credit union will be added together and insured up to
$100,000.
You may find the following brochures helpful:
For more information, please visit the NCUA Share Insurance Estimator or contact
us.
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