What is Electronic Deposit Insurance (EDIE)?

Electronic Deposit Insurance Estimator (EDIE) is a tool provided by the Federal Deposit Insurance Corporation (FDIC) for calculating insurance coverage for deposit accounts such as checking accounts, savings accounts, certificates of deposit, or FDIC-insured bank money market accounts. .

However, EDIE is not suitable for all types of accounts. It should not be used for investment accounts with assets such as stocks, bonds, mutual funds, annuities, cryptocurrencies, or any other investment account that is not classified as a deposit. Furthermore, if the deposit account is not at a FDIC-insured bank, EDIE does not apply.

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  • The FDIC provides a free online tool, the Electronic Deposit Insurance Estimator (EDIE), that helps determine whether deposits are protected by their coverage, and to what extent.
  • The FDIC provides insurance that covers the loss of up to $250,000 in deposits per account and account holder with FDIC-insured banks.
  • Thus joint deposit accounts have coverage of up to $250,000 per account holder (or $500,000 for two account holders, $750,000 for three, and so on).
  • Individuals can also achieve over $250,000 in protection by having multiple types of qualifying deposit accounts, or accounts with multiple banks.
  • Investment accounts and some other types of bank accounts are not eligible for FDIC insurance.

Understanding Federal Deposit Insurance

Federal Deposit Insurance is provided by the Federal Deposit Insurance Corporation to protect depositors from losing their assets held by banks. FDIC insurance covers banks and other financial institutions; It is not a type of insurance that individual account holders can purchase on their own. For this reason, it is especially important that you confirm that your bank is FDIC-insured before opening an account. To determine this, look for the official FDIC labels in the teller windows or call the FDIC’s toll-free hotline (1-877-ASK-FDIC=877-275-3342).

The FDIC standard deposit insurance amount is $250,000 per account holder.

The basic FDIC insurance coverage limit is $250,000 per FDIC-insured account holder, which means that up to $250,000 in deposits into the account are protected by this insurance. This applies to individual bank accounts, Individual Retirement Accounts (IRAs), and some Supplemental Retirement Accounts.

Note that FDIC insurance works a little differently for joint accounts. In this case, the coverage limit is $250,000 per co-owner, which means the total coverage could be higher depending on the number of account holders. It is also possible for an individual to have more than $250,000 in deposits in a single FDIC-covered bank if that person has deposits in multiple account classes (for example, in both an Individual Savings Account and an IRA).

using EDIE

To use EDIE, start by confirming that the bank and accounts in question are covered by the FDIC. Next, visit the FDIC’s free online EDIE tool. To use the calculator, you will need to perform the following steps:

  • Step 1: Enter your bank name (or use the EDIE bank search tool to find your bank by state, city, and other information) and select if you’re looking for personal, business, or government account information.
  • Step 2a: If you are looking for information related to a personal account, include the ownership type (eg, single, joint, etc.), owner name and status, account nickname (to help you identify the account in the final report), account balance, and then click Add to report.
  • Step 2b: If you are looking for information related to a business account, include business type, company name, EIN/TAIN, account title and balance, then click “Add to Report”.
  • Step 2c: If you are looking for information on a government account, include information about the account holder and official custodian, public unit name, employer identification number/tax identification number, account title and balance, make sure the account meets EDIE requirements, and then click Add to the report.”
  • Step 3You now have the option to add a new account in the same bank or for your insurance coverage account. EDIE will indicate on the same page whether your deposits are fully insured. You then have the option to add a new account, print the report, or create another report.

FDIC Deposit Insurance is backed by the full faith and credit of the United States Government.

Note that the purpose of EDIE is to make decisions about insurance coverage for all of the account holder’s accounts at a single financial institution simultaneously. If you hold accounts at multiple banks, complete the information entry process for all accounts at one bank and create a report before starting over with the next bank.

How do I know if my deposits are FDIC insured?

The first step is to confirm that your bank is FDIC-insured. All FDIC-insured organizations are required to post official FDIC markings at branches. You can also call the FDIC hotline at 1-877-ASK-FDIC to inquire. Next, use the FDIC’s EDIE calculator to determine whether your deposits are fully or partially insured.

How is the deposit insurance premium calculated?

The FDIC supplements rating rates for different banks according to their size and using a risk-based pricing system. These prices are updated regularly. Factors affecting the valuation rate may include the amount of assets under management (AUM), measures of the bank’s ability to withstand various stresses, and measures of loss severity, among others.

What happens if you have more than $250,000 in the bank?

Normally your deposits in a single account exceeding $250,000 are not insured against loss. However, accounts at several banks or across different account classes may help provide additional coverage.

What is the maximum deposit insurance coverage?

Standard deposit insurance coverage for FDIC-insured accounts is $250,000 per account, per account holder. This means that an individual with $250,000 per account in multiple accounts would have more than $250,000 protected by FDIC insurance. In fact, there are some specialized accounts that spread funds across several banks to increase deposit insurance coverage to more than $1 million.

bottom line

To determine how well your deposits are protected by FDIC insurance, use the FDIC’s Electronic Deposit Insurance Estimator (EDIE). Any individual, family, or business looking to open a deposit account with a US bank must confirm in advance that the bank is FDIC-insured. FDIC insurance covers losses of up to $250,000 in deposits for certain types of accounts, per account and per account holder. Individuals can achieve additional coverage by having multiple accounts (for example, an individual savings account and a joint savings account).

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