What is Electronic Deposit Insurance Estimator (EDIE)?
The Electronic Deposit Insurance Estimator (EDIE) is a tool provided by the Federal Deposit Insurance Corporation (FDIC) that can calculate insurance coverage for deposit accounts such as checking or savings accounts, certificates of deposit, or money market accounts at FDIC-insured banks. .
However, EDIE is not suitable for all account types. 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. Further, if the deposit account is not in an FDIC-insured bank, the EDIE does not apply.
Key Takeaways
- The FDIC provides a free online tool, the Electronic Deposit Insurance Estimator (EDIE), that helps determine whether and to what extent deposits are protected by its coverage.
- The FDIC provides insurance covering deposit losses of up to $250,000 per account and per account holder at FDIC-insured banks.
- Thus joint deposit accounts have coverage up to $250,000 per account holder (or $500,000 for two account holders, $750,000 for three, and so on).
- Individuals can obtain protection above $250,000 by holding multiple types of qualified deposit accounts or accounts at multiple banks.
- Investment accounts and certain other types of bank accounts are not eligible for FDIC insurance.
Understanding Federal Deposit Insurance
Federal deposit insurance is provided by the FDIC to protect depositors against loss of assets held by banks. FDIC insurance covers banks and other financial institutions; This is not a type of insurance that individual account holders can purchase on their own. For this reason, it’s especially important that you make sure your bank is FDIC-insured before you open an account. To determine this, either look for the official FDIC symbols on the teller window or call the FDIC’s toll-free hotline (1-877-ASK-FDIC = 877-275-3342).
The standard FDIC deposit insurance amount is $250,000 per account holder.
The basic FDIC insurance coverage limit is $250,000 per FDIC-insured account owner, meaning deposits of up to $250,000 in an account are protected by this insurance. This applies to individual bank accounts, individual retirement accounts (IRAs) and some additional retirement accounts.
Note that FDIC insurance works a little differently for joint accounts. In this case, coverage is limited to $250,000 per co-owner, meaning total coverage may be higher depending on the number of account holders. It is also possible for an individual to have more than $250,000 in deposits at an FDIC-insured bank if that individual has deposits in multiple account categories (for example, both a single savings account and an IRA).
Using EDIE
To use EDIE, start by making sure your bank and the accounts in question are covered by the FDIC. Next, visit the FDIC’s free online EDIE tool. To use the calculator, you 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 indicate whether you’re searching for information about a personal, business, or government account.
- Step 2a: If you are searching for information about an individual account, include the type of ownership (eg, sole, joint, etc.), the name and status of the owner, an account nickname (to help you identify the account on the final report). and account balance, then click “Add to Report”.
- Step 2 b: If you are searching for information about a business account, include the business type, business name, EIN/TIN, and an account nickname and balance, then click “Add to Report.”
- Step 2 c: If you are seeking information for a government account, include information about the account holder and official custodian, the public unit name, EIN/TIN, an account nickname and balance, and ensure that the account meets EDIE requirements. , then click “Add to Report”.
- Step 3: You now have the option of adding a new account with the same bank or calculating your insurance coverage. EDIE will indicate on the same page whether your deposit is fully insured. You then have the choice of adding a new account, printing the report, or creating another report
FDIC deposit insurance is backed by the full faith and credit of the US government.
Note that the purpose of EDIE is to decide on insurance coverage for all accounts of an account holder at a financial institution at once. If you hold accounts with more than one bank, complete the process of entering all account information in one bank and generate a report before starting again with the next bank.
How do I know if my deposit is insured by the FDIC?
The first step is to make sure your bank is FDIC-insured. All FDIC-insured institutions must post official FDIC signs at their branches. You can also call the FDIC hotline at 1-877-ASK-FDIC to ask. Next, use the FDIC’s EDIE calculator to determine whether your deposit is fully or partially insured.
How are deposit insurance premiums calculated?
The FDIC completes assessment rates for different banks according to their size and uses a risk-based pricing system. These rates are updated regularly. Factors affecting valuation rates may include, among other factors, the amount of assets under management (AUM), a measure of a bank’s ability to withstand various stresses, and a measure of loss severity.
What if you have more than $250,000 in the bank?
Your deposits in a single account over $250,000 are generally not insured against loss. However, accounts at multiple banks or across different account categories can 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 would have more than $250,000 in multiple accounts each protected by FDIC insurance of $250,000. In fact, there are some specialized accounts that spread the funds across multiple banks so that the deposit insurance coverage adds up 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 at a U.S. bank should first confirm that the bank is FDIC-insured. FDIC insurance covers losses up to $250,000 on deposits for certain types of accounts, per account and per account holder. Individuals can obtain additional coverage by holding multiple accounts (for example, both an individual and a joint savings account).