$250,000 Share Insurance Protection Extended to 2013
May 26, 2009, Alexandria, Va. – The Helping Families Save Their Homes Act of 2009, signed into law May 20, 2009, includes a provision extending $250,000 share insurance coverage provided by the National Credit Union Share Insurance Fund through December 31, 2013. Previously, this level of coverage was set to expire December 31, 2009. The new law also requires NCUA to use the higher $250,000 standard maximum share insurance amount when making decisions about premiums and administering insurance deposit adjustments.
NCUA will shortly update its guidance about share insurance coverage to address the provisions of the new law. Information about NCUA insurance coverage is available online via the Share Insurance Tool Kit at http://www.ncua.gov/Resources/ShareInsuranceToolkit.aspx.
The National Credit Union Administration is the independent federal agency that regulates charters and supervises federal credit unions. NCUA, with the backing of the full faith and credit of the U.S. government, also operates and manages the National Credit Union Share Insurance Fund, insuring the deposits of nearly 90 million account holders in all federal credit unions and the majority of state-chartered credit unions.
In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act, through December 31, 2012, all funds in “noninterest-bearing transaction accounts” are insured in full by the National Credit Union Administration. This unlimited coverage is in addition to, and separate from, the coverage of at least $250,000 available to members under the NCUA’s general share insurance rules.
The term “noninterest-bearing transaction account” includes a traditional share draft account (or demand deposit account) on which the insured credit union pays no interest or dividend. It does not include any transaction account that may earn interest or dividends, such as a negotiable order of withdrawal (“NOW”) account, money-market account, or Interest on Lawyers Trust Account (“IOLTA”), even if share drafts may be drawn on the account.
The temporary full insurance coverage of “noninterest-bearing transaction accounts” expires on December 31, 2012. After December 31, 2012, funds in noninterest-bearing transaction accounts will be insured under the NCUA’s general share insurance rules, subject to the Standard Maximum Share Insurance Amount of $250,000.
For more information about NCUA insurance coverage of transaction accounts, visit http://www.ncua.gov.
