SAVINGS & INVESTING
Federal Share Insurance: Your Warranty of Safety
Your shares at Lubrizol Employees’ Credit union are federally insured by the National Credit Union Share Insurance Fund (NCUSIF), an arm of the National Credit Union Administration (NCUA). NCUA is an independent agency of the United States government. Your shares are backed by our solid financial standing. However, the insurance protects members against loss if a federal credit union fails.
Share Insurance FAQ
NCUA share insurance covers many types of share deposits received at a federally insured credit union, including deposits in a share draft account, share savings account, or time deposit such as a share certificate. NCUA insurance covers members' accounts at each federally insured credit union, dollar-for-dollar, including principal and any accrued dividend through the date of the insured credit union’s closing, up to the insurance limit. This coverage also applies to nonmember deposits when permitted by law.
NCUA does not insure money invested in stocks, bonds, mutual funds, life insurance policies, annuities or municipal securities, even if these investment or insurance products are sold at a federally insured credit union. Credit unions often provide these services to their members through third-parties, and the investment and insurance products are not insured by the NCUSIF. In locations where these investment and insurance products are offered or sold to members, credit unions are required to disclose that the products:
-- are not insured by NCUA;
-- are not deposits or other obligations of the credit union and are not guaranteed by the credit union; and
-- are subject to investment risks, including possible loss of the principal invested.
In addition, NCUA does not insure safe deposit boxes or their contents.
*These share insurance coverage limits refer to the total of all shares that account owners have at each federally-insured credit union. The listing above shows only the most common ownership types that apply to individual and family shares, and assumes that all NCUA requirements are met.
Single Ownership Accounts (owned by one person with no beneficiaries): $250,000 per member-owner
Joint Ownership Accounts (two or more persons with no beneficiaries): $250,000 per owner (with the primary owner a member of the credit union)
IRAs and other certain retirement accounts: $250,000 per member-owner
Revocable trust accounts: Each member-owner is insured up to $250,000 for each eligible beneficiary named or identified in the revocable trust, subject to limitations and requirements.
Irrevocable trust accounts: Each owner (so long as all owners OR all beneficiaries are members of the credit union) is insured up to $250,000 for each beneficiary named or identified in the irrevocable trust, subject to specific limitations and requirements. Coverdell Education Savings Accounts, formerly education IRAs, are insured as irrevocable trust accounts.
A qualifying eligible beneficiary must be a natural person, or a charitable organization or non-profit entity under the Internal Revenue Code.
*These share insurance coverage limits refer to the total of all shares that account owners have at each federally insured credit union. The listing above shows only the most common ownership types that apply to individual and family shares, and assumes that all NCUA requirements are met.
Is it possible to have more than $250,000 at one federally insured credit union and still be fully covered?
You may qualify for more than $250,000 in coverage at one insured credit union if you own share accounts in different ownership categories. The most common account ownership categories for individual and family shares are single owner accounts, joint accounts, certain retirement accounts, revocable trust accounts, and irrevocable trust accounts.
Share insurance coverage can be increased only if accounts are held in different categories of ownership. These categories include the four most common ownership categories: single owner accounts, retirement accounts, joint accounts, and revocable trust accounts; and less common ownership categories such as irrevocable trust accounts, employee benefit plan accounts, corporation, partnership and unincorporated association accounts, and public unit or government depositor accounts. A credit union member cannot increase federal insurance by dividing funds owned in the same ownership category among different products. For example, the type of products in which a member account is held - whether savings accounts, share draft/checking accounts, or share certificates - has no bearing on the amount of insurance coverage.
Federal law requires the NCUA to make payments of insured accounts "as soon as possible" upon the failure of a federally insured credit union. While every credit union failure is unique, there are standard policies and procedures that the NCUA follows in making share insurance payments. Historically, insured funds are available to members within just a few days after the closure of an insured credit union.
The member remains liable for any payments due on a loan or credit card. The member would continue making payments as they did before the credit union failed until they are instructed to do otherwise in writing by the acquiring credit union or the NCUA. If a member's credit union is liquidated and the member has both a loan and shares at the credit union, the NCUA may deduct the loan balance from the share balance.
More About How Your Funds are Insured
Are all your deposits insured? Find out with NCUA’s electronic Share Insurance Estimator.
Want to learn even more? Visit NCUA for publications, videos and more!
