Question: With uncertainties concerning the financial soundness of some banks there has been reassuring mention in news stories of FDIC protections. I have yet to hear mention of similar reassurance to members of credit unions that belong to the National Credit Union Association. Is it in fact known that National Credit Union Share Insurance is on a par with FDIC and that invested funds are equally safe?… Roy, South Burlington, VT.
Answer: The short answer is yes. The outline of the insurance coverage is the same as FDIC, with a standard $100,000 protection that jumps to $250,000 for certain retirement accounts, such as IRAs.
You can get more information at the National Credit Union website at www.ncua.gov.
Here are highlights from their discussion of deposit insurance:
The shares in your credit union are insured by the National Credit Union Share Insurance Fund (NCUSIF), an arm of NCUA. Established by Congress in 1970 to insure member share accounts at federally insured credit unions, the NCUSIF is managed by NCUA under the direction of the three-person NCUA Board. Your share insurance is similar to the deposit insurance protection offered by the Federal Deposit Insurance Corporation (FDIC)…
Credit unions that are insured by the NCUSIF must display in their offices the official NCUA insurance sign which appears on the cover of this brochure. All federal credit unions must be insured by NCUA…
Not one penny of insured savings has ever been lost by a member of a federally insured credit union. The federal insurance fund has several programs to help insured credit unions which may be experiencing problems. Liquidations or failures are a last resort. If a federally insured credit union does fail, however, the NCUSIF will make any necessary payouts to the credit union’s members. These payouts are usually done within 3 days from the time the credit union closes its doors…..
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