National Credit Union Share Insurance Fund (NCUSIF)

What is the NCUSIF?

Like the FDIC, the NCUA also provides deposit insurance to protect depositors’ savings in the event of a credit union failure. The deposit insurance program is called the National Credit Union Share Insurance Fund (NCUSIF).

The NCUSIF was also established in 1970 as a response to the growing number of credit unions and the need for deposit insurance. The NCUSIF is funded through premiums paid by insured credit unions and is administered by the NCUA.

The purpose of the NCUSIF is to protect depositors by providing insurance coverage for their deposits at credit unions. The standard insurance amount is $250,000 per depositor per insured credit union, the same as the FDIC insurance limit. Like the FDIC, the NCUSIF provides coverage for savings accounts, checking accounts, money market accounts, and certificates of deposit (CDs).

Since its establishment, the NCUSIF has played an important role in maintaining confidence in the credit union system and protecting depositors’ savings. The NCUSIF has responded to numerous credit union failures and has helped to prevent further losses to depositors.

How the National Credit Union Share Insurance Fund Works

NCUA deposit insurance works similarly to FDIC insurance, providing coverage for depositors in case of a credit union failure.

The standard insurance amount is $250,000 per depositor per insured credit union, which means that if you have less than $250,000 in deposits at a single credit union, your deposits are fully insured.

There are a few options available to insure more than $250,000. One option is to open accounts at multiple credit unions.

For example, if you have $500,000 in savings, you could open accounts at two credit unions and deposit $250,000 in each account. This would ensure that all of your deposits are fully insured.

Another option is to use different ownership categories. The NCUSIF provides different ownership categories that offer separate insurance coverage.

For example, if you have a joint account with your spouse, the account would be insured up to $500,000 ($250,000 for your share and $250,000 for your spouse’s share). The NCUSIF also provides separate insurance coverage for retirement accounts, such as individual retirement accounts (IRAs).

To recap, you can insure more than the standard amount of $250,000 through the NCUSIF:

  • Different ownership categories: Depositors can have accounts in different ownership categories to increase their coverage. The NCUSIF covers different ownership categories, such as individual accounts, joint accounts, retirement accounts, and trust accounts.
  • Multiple credit unions: Depositors can spread their deposits across multiple credit unions to increase their coverage. Each credit union is insured separately by the NCUSIF, so depositors can have accounts at different credit unions to increase their coverage.

To ensure that your deposits are fully insured, it is essential to understand the NCUSIF coverage limits and ownership categories. The NCUA provides resources and tools, such as the Share Insurance Estimator, to help individuals determine their insurance coverage.

In addition to understanding the coverage limits, finding a credit union that is NCUSIF-insured is also important. Not all credit unions are insured by the NCUSIF, so it’s important to check with your credit union to ensure that it is insured.

How do you know if your credit union is insured?

All federally insured credit unions must prominently display the official NCUA insurance sign at each teller station, where insured account deposits are normally received in their principal place of business and in all branches.

Federally insured credit unions must also display the official sign on their Internet page, if any, where they accept share deposits or open accounts. No credit union may end its federal insurance without first notifying members.