NCUA Insurance

If you’ve been looking to open an account with a credit union, you might have come across NCUA insurance.

All federal credit unions offer NCUA insurance, and it’s one of the most important risk management tools at your disposal.

NCUA insurance coverage takes away most of the risk associated with holding money in a credit union account.

Because of this, it’s good to understand NCUA insurance well so that you can use it strategically to your best advantage.

What Is NCUA Insurance?

Before we begin talking about NCUA insurance, we need to understand who the NCUA is and what it does. Knowing this can help us get a clearer picture of this agency and how it can protect your money.

The NCUA (National Credit Union Administration) is a federal government agency set up by the United States Congress back in 1970. It charters and regulates all federal credit unions, protects its members, and insures their accounts.

The NCUA insures credit unions through the NCUSIF – National Credit Union Share Insurance Fund. This fund is there to cover eligible deposits of credit union members up to the maximum limit. In all, the fund covers over 6,000 federal credit unions. It is backed by the full faith and credit of the United States government.

You might have noticed that we mention federal credit unions when talking about NCUA insurance. That’s because this insurance only covers federal credit unions. Non-federal credit unions, also known as State-Chartered Credit Unions, are not insured through the NCUSIF.

In most cases, they’re insured privately or by institutions not backed by the US government.


You might have also heard of FDIC (Federal Deposit Insurance Corporation) insurance and wonder if there is any connection between these two at all.

While the two are very similar, they work for different types of financial institutions. NCUA insurance is only available at accounts held at federal credit unions.

In contrast, FDIC insurance is only available for bank accounts (accounts you open with and hold at a bank). Aside from this difference, both insurances work very similarly, so if you’re switching from a bank to a credit union or vice versa, you’ll be very familiar with the new insurance you’re getting.

NCUA Insurance Limits

Just like other types of insurance, NCUA insurance is not unlimited.

Knowing its limitations is important as it can help you make sure you get the maximum coverage for the money you have deposited at credit unions.

NCUA insurance is limited to $250,000 per account owner per account category at any given credit union. There are 14 different types of accounts and some seven different categories.

Knowing this can help you spread your money in such a way so that it falls under various categories and, as such, help you get more insurance. We will cover all of this later in this article.

Which Credit Unions Are Covered?

As we said earlier, NCUA doesn’t cover State-chartered credit unions, only federal credit unions. State-chartered credit unions use another type of insurance (either private or by an institution that the US government does not back).

Federal credit unions are chartered under the Federal Credit Union Act, which was signed on the 26th of June 1934 by the then-president Franklin D. Roosevelt. During the Great Depression, many Americans needed access to crest, which the act aimed to provide.

State-charted credit unions are not chartered under this act. Instead, they use guidelines established by the state in which they operate. It is worth noting that not all states have these guidelines. Credit unions operating in states that do not offer these guidelines must use the federal charter instead.

All credit unions covered by the NCUA must display the NCUSIF sign in both advertising and their offices and branches. Looking out for this sign should make it easy to know if a credit union is insured or not. If in doubt, you can always use the official locator directory, which you’ll find at

Which Accounts Are Covered by NCUA Insurance?

As mentioned above, NCUA insurance covers 14 different types of qualifying accounts and seven different ownership categories.

For all accounts combined in any given ownership category, you are insured up to $250,000 (if your total balance in all accounts combined under a given ownership category exceeds the $250,000 limit).

This section will go through the different account categories and the various accounts covered in each category.

We will then use a real-life example to showcase how insurance works and how you can easily work out your coverage to make sure your funds are as insured as possible.

Account Category: Single Ownership Accounts

Deposit accounts held by one member-owner

Eligible Accounts:

Total Coverage: $250,000 per owner for all deposits combined held in any individual accounts at one credit union.

Account Category: Joint Ownership Accounts

Deposit accounts held by two or more member-owners

Eligible Accounts:

  • Checking accounts
  • Savings Accounts
  • CDs (Certificate of Deposits)
  • MMAs (Money Market Accounts)

Total Coverage: $250,000 per co-owner for all deposits combined held in any of these accounts at one credit union.

Account Category: Retirement Accounts

Retirement investments held by one account owner

Eligible Accounts:

  • Traditional IRAs (Individual Retirement Accounts)
  • Roth IRAs
  • 401 (k) Plans
  • KEOGH Plans

Total Coverage: $250,000 per owner for all deposits combined held in any IRA accounts. 401(k) and KEOGH accounts are insured separately.

Account Category: Revocable Trust Accounts

Accounts held by beneficiaries or owners with deposits payable on the death of the owner

Eligible Accounts:

  • Living or Family Accounts
  • POD Accounts (Payable on Death)
  • ITF Accounts (In Trust For)

Total Coverage: $250,000 per owner or named beneficiaries for all deposits combined held in any of these accounts at one credit union.

Account Category: Irrevocable Trust Accounts

Accounts with no rights of ownership

Eligible Accounts:

  • Coverdell Education Savings Accounts

Total Coverage: $250,000 per beneficiary for all deposits combined held in any of these accounts at one credit union.

Account Category: Corporate Accounts

Accounts held by a corporation, unincorporated association, or partnership

Eligible Accounts:

  • Accounts held by the organization

Total Coverage: $250,000 per entity for all deposits combined held in any of these accounts at one credit union.

Account Category: Government Accounts

Accounts held by government depositors

Eligible Accounts:

  • Government Fund Accounts

Total Coverage: $250,000 per custodian for all deposits combined held in any of these accounts at one credit union.

What does this all mean?

Understanding these categories and account eligibility is important, so you know what you’re covered for and what you are not.

For example, suppose you have a checking account and a savings account with the same credit union. In that case, you are covered for up to $250,000 in insured funds on both accounts together.

If you decide to invest in a CD, then the CD’s total must be added to your savings and checking accounts’ total balance. If your balance goes over $250,000, the amount it goes over is not covered by the insurance.

Imagine you’ve decided to open a checking account with your husband or wife as a joint account. In that case, that account is covered under the Joint Ownership Accounts category, meaning that you get new insurance for $250,000 for that account and any other account that falls within the same category.

Do remember that the insurance limit is per credit union. If you go over the coverage limit, you can decide whether you want to move the excess money into an account of a different category. Alternatively, you can move that money to another credit union or a bank.

If your situation is more complicated than the example above, or you don’t know your coverage limits, use the share insurance estimator offered free of charge by the NCUA. All you need to do is head over to and follow the instructions provided.

What The NCUA Insurance Doesn’t Cover

Credit unions also offer several types of accounts that the NCUA insurance doesn’t cover.

Knowing what these accounts are is important as any funds or money held in these accounts won’t be insured. So, if the credit union should fail, you wouldn’t be protected against losses.

While these accounts are not very common, more and more credit unions have started to offer them. These include:

  • Stocks
  • Bonds
  • Mutual Funds
  • Annuities
  • Treasury Bills
  • Life Insurance accounts

Many of these accounts carry additional risk, which is why the NCUA doesn’t insure them.

While deposit accounts are considered very safe investments, stock, bonds, and mutual funds, in particular, are very risky and can lead to losses on the capital invested.

How To Get NCUA Insurance

There are no special processes or requirements for getting NCUA insurance on your eligible accounts.

All you need to do is open an account with an insured credit union, and the credit union will do everything automatically for you.

Remember to check how much coverage you have since some accounts, such as jumbo share certificates tending to grow quite large.

Insurance is there to protect you from any financial losses following the failure of the credit union where you hold your money. While this is highly unlikely, if it does, the NCUA will refund you your money up to the limit within a few days, increasing the accessibility to the funds.

It is well worth noting that credit unions insured by the NCUA undergo a rigorous process that aims to ensure that they are financially healthy and sound. Because of this, it is unlikely that the credit union will fail.

Even so, it is good to know that you’re covered should this happen.

NCUA Insurance FAQs

What is NCUA?

To sum up, the NCUA is an independent federal agency that administers federal credit unions.

It also offers their members share insurance coverage, making credit unions a safe place to bank. Insurance is offered per depositor at a credit union with a cap of $250,000 per account category.

What Does NCUA stand for?

The NCUA stands for the National Credit Union Administration.

Is NCUA insurance per account?

NCUA insurance covers up to $250,000 per depositor, per credit union, per ownership category. So if you have both a joint and a single account at the same credit union, both will be insured up to the limit.

Are joint accounts insured?

Joint account holders are insured on their joint account balances. The insurance is offered as additional coverage to accounts held in the single ownership category. The limit for this category is $250,000 per co-owner.

Are share accounts insured?

NCUA share insurance covers share accounts which typically fall under the single ownership category. The limit for this category is $250,000 for all balances combined.

Is NCUA insurance as good as FDIC?

NCUA and FDIC insurances are very similar. Both protect you against any losses should the financial institution your money is held at fail. The main difference is that FDIC works for banks, while the NCUA covers credit unions – but they’re as good as one another.

How do I maximize my NCUA insurance?

The best way to maximize your coverage is by spreading your money across multiple institutions if it goes over the $250,000 mark. Remember that ownership categories can also affect how your money is insured, so you can have more than $250,000 insured at one institution, as long as your money is spread across different categories.

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