Ann C. Logue is a freelance writer specializing in business and finance. She is a chartered financial analyst, and before coming into writing, she worked for 12 years as an investment analyst. She's written five books on investing for Wiley’s …For Dummies series, and her freelance writing has appeared in the New York Times, Barron's, Newsweek, and Entrepreneur, among others. She can be reached at annlogue.com.Hearst Television participates in various affiliate marketing programs, which means we may get paid commissions on editorially chosen products purchased through our links to retailer sites. This may influence which products we write about and where those products appear on the site, but it does not affect our recommendations or advice, which are grounded in research.Mobile app users, click here for the best viewing experience.The recent failure of Silicon Valley Bank was shocking: The institution, which was a banking hub for tech startups, was thought to be strong until just a few days before its collapse. It was also the first bank failure since 2020, as well as the most dramatic failure since the 2008 financial crisis. Silicon Valley Bank had almost 500 times more assets — $209 billion total — than all of the banks that failed in 2020 combined. While the speed and severity of the collapse were surprising, the Federal Deposit Insurance Corporation (FDIC) stepped in right away to protect depositors at both Silicon Valley Bank, as well as Signature Bank in New York, which failed days later.The FDIC’s process for dealing with failing banks works well, but it doesn’t always cover all depositors or all types of accounts. Are you protected if your bank goes under?What is FDIC insurance?The Federal Deposit Insurance Corporation (FDIC) is an agency of the U.S. government that operates the FDIC insurance program. Almost all banks in the United States are covered by the FDIC, and customers receive coverage automatically. In exchange, banks must meet strict regulations for asset management and financial reporting, among other things, or face being taken over by the FDIC. Credit union deposits are also insured, through the National Credit Union Administration (NCUA), which operates similarly to the FDIC program. PHNwYW4+PC9zcGFuPjxzY3JpcHQgYXN5bmM9InRydWUiIHNyYz0iaHR0cHM6Ly9zdGF0aWMubXlmaW5hbmNlLmNvbS93aWRnZXQvbXlGaW5hbmNlLmpzIj48L3NjcmlwdD48ZGl2IGNsYXNzPSJteUZpbmFuY2Utd2lkZ2V0IiBkYXRhLWFkLWlkPSJjYjdiMTc1Yy03YjU2LTRmY2QtODVjZS1kYjcxNjJmZDhmM2UiIGRhdGEtY2FtcGFpZ249ImhlYXJzdHR2LXNhdmluZ3MtbXVsdGkiIGRhdGEtc3ViLWlkPSJodHRwOi8vd3d3LmtjcmEuY29tL2FydGljbGUvZmRpYy1pbnN1cmFuY2UvNDMzNDA5NDMiPjwvZGl2Pg==How does FDIC insurance work?With FDIC insurance, bank deposits are covered up to $250,000 per customer. In the rare occasion when a bank fails, the FDIC may set up a separate bank to handle customer accounts, or it may sell the bank (at a bargain price) to a bank that agrees to take over the deposits. In some cases, customers can access money immediately. Insured Silicon Valley Bank customers will have to wait one business day. The FDIC insurance limits per customer, per bank are:$250,000 for single accounts$250,000 for each joint account holder$250,000 for each qualified retirement account, such as an IRA or a Roth IRA$250,000 for each business account$250,000 for each account held by a local, state, or federal government agency$250,000 for each irrevocable trust$250,000 for each beneficiary of a revocable trustPeople who have more than $250,000 in any one bank can increase their coverage by taking advantage of different account structures. For example, someone could hold $250,000 in a single account under their name and another $250,000 in a joint account with a spouse (with the other account holder insured for another $250,000), for a total of $500,000 in insured deposits. They could have another $250,000 at another bank and be insured for that.While it’s unusual for an individual to have more than $250,000 in a single account in a single bank, it’s common for businesses. One of the many concerns in the collapse of Silicon Valley Bank is that companies in the area used it for payroll, and deposit insurance may not be enough to ensure that those companies’ employees get paid.The FDIC has been known to make arrangements to cover all deposits in a failed bank, but that isn’t guaranteed. In this case, the federal government has stepped in and promised that everyone will get their money back with the help of the FDIC’s Deposit Insurance Fund, which is funded by the banks themselves. Are CDs FDIC insured?Most bank certificates of deposit (or CDs) are covered by deposit insurance up to $250,000, just like savings accounts. Many banks offer jumbo CDs, which are CDs valued at more than $100,000. These carry higher interest rates than smaller CDs. Some banks offer uninsured CDs at values over $250,000 that carry even higher interest rates. Credit union CDs are not covered by the FDIC but are insured by the NCUA, with similar limits as bank CDs.PHNwYW4+PC9zcGFuPjxzY3JpcHQgYXN5bmM9InRydWUiIHNyYz0iaHR0cHM6Ly9zdGF0aWMubXlmaW5hbmNlLmNvbS93aWRnZXQvbXlGaW5hbmNlLmpzIj48L3NjcmlwdD48ZGl2IGNsYXNzPSJteUZpbmFuY2Utd2lkZ2V0IiBkYXRhLWFkLWlkPSIwN2ZiOTg4My0yNzgwLTQ3MjItYmIzZi1mMjBhZWEwYWM1ZWEiIGRhdGEtY2FtcGFpZ249ImhlYXJzdHR2LWNkLW11bHRpIiBkYXRhLXN1Yi1pZD0iaHR0cDovL3d3dy5rY3JhLmNvbS9hcnRpY2xlL2ZkaWMtaW5zdXJhbmNlLzQzMzQwOTQzIj48L2Rpdj4=Are money market accounts FDIC insured?Many banks offer FDIC-insured money market deposit accounts that pay a higher interest rate than traditional savings and checking accounts. Many brokerage firms and mutual fund companies also offer money market mutual funds, but these are not federally insured. These funds act like money market deposit accounts at banks, but they may invest in riskier assets than a bank is able to. They often pay higher interest than similar bank accounts, but money market mutual funds are not insured. While the risk of loss from money market mutual funds is very low, there is some risk and people have lost money in them.Bottom lineBank failures in the U.S. are rare, but they do happen. The Silicon Valley Bank collapse is a reminder to check on your accounts. If you or your business are carrying large balances at a single bank, it may be time to look at moving some funds to a second bank in order to maintain deposit insurance. PHNwYW4+PC9zcGFuPjxzY3JpcHQgYXN5bmM9InRydWUiIHNyYz0iaHR0cHM6Ly9zdGF0aWMubXlmaW5hbmNlLmNvbS93aWRnZXQvbXlGaW5hbmNlLmpzIj48L3NjcmlwdD48ZGl2IGNsYXNzPSJteUZpbmFuY2Utd2lkZ2V0IiBkYXRhLWFkLWlkPSJjYjdiMTc1Yy03YjU2LTRmY2QtODVjZS1kYjcxNjJmZDhmM2UiIGRhdGEtY2FtcGFpZ249ImhlYXJzdHR2LXNhdmluZ3MtbXVsdGkiIGRhdGEtc3ViLWlkPSJodHRwOi8vd3d3LmtjcmEuY29tL2FydGljbGUvZmRpYy1pbnN1cmFuY2UvNDMzNDA5NDMiPjwvZGl2Pgo=Editorial Disclosure: All articles are prepared by editorial staff and contributors. Opinions expressed therein are solely those of the editorial team and have not been reviewed or approved by any advertiser. The information, including rates and fees, presented in this article is accurate as of the date of the publish. Check the lender’s website for the most current information.This article was originally published on SFGate.com and reviewed by Lauren Williamson, who serves as Financial and Home Services Editor for the Hearst E-Commerce team. Email her at lauren.williamson@hearst.com.