Franklin Delano Roosevelt signs Banking Act of 1935

In 1933, the Federal Deposit Insurance Corporation – often identified as simply the “FDIC” – was created as a direct response to the failure of several banks during the Great Depression.

Today, this corporation is known for taking measures to protect depositors. In fact, since the initiation of the corporation’s insurance in the year of 1934, not one depositor has lost any of their covered funds.

Due to recent fluctuations in the Stock Market and other financial concerns, many individuals have inquired as to whether their money is covered in our financial institution. We feel it is important to cover this topic – at length – this week.

Continue reading to learn more about FDIC insurance and why you can deposit with confidence with us at Somerville Bank.

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Bank Products Covered by the FDIC

FDIC insurance for deposits is covered by the credit of the government in the United States. It covers the following:

  • Checking Accounts
  • Savings Accounts
  • Money Market Deposit Accounts or “MMDAs”
  • Money Orders
  • Cashier’s Checks
  • Negotiable Order of Withdrawal Accounts of “NOW”
  • Certificates of Deposits or “CDs”
  • Official Items Issued by a Covered Bank

Application for Coverage

Consumers are not required to apply for coverage by the FDIC. It occurs automatically when a covered type of account is opened at a financial institution that is covered by FDIC insurance.

When opening an account, you should ensure that the account you are in the process of initiating is covered.

All teller windows will have an official sign that informs customers that they offer FDIC coverage.

What Happens During a Bank Failure?

It is a known fact that a bank has the potential to fail. If this happens, a special authority will initiate with the closing process; however, the FDIC continues to work for consumers. The staff that represents the FDIC will be within the institution and will identify all patrons that have funds within the facility. In nearly all instances, the bank will be purchased by another financial institution. If this does not happen, the FDIC will have access to the funds of those that have a covered account and those individuals may still access their money.

How Does the FDIC Protect Deposits Made in a Covered Account?

The FDIC holds supervision over all protected financial institutions. The organization ensures operational safety, compliance, protection laws, and numerous other regulations.

Additionally, a wide variety of agencies ensure regulation and protection of funds. These include the National Credit Union Administration, the Federal Reserve System, the Consumer Financial Protection Bureau, and the Office of the Comptroller of the Currency.

In short, FDIC is a back up to protect the money that you deposit into a covered account.

There is a back up to back that up and a back up to back that, respectively, Regardless, funds covered by the FDIC are 100% protected.

Consumer Complaints, Questions, and Other Issues

If you need assistance related to your bank accounts or the FDIC, you may call 1-877-275-3342. There is a specially-designated Consumer Response Center (CRC) that investigates, researches, and assists in complaints, issues, and questions.

You may also contact this phone number if you have any questions about the laws and regulations that surround FDIC insured financial institutions. If you have an account with us here at Somerville Bank and have questions, complaints, or concerns, you may contact us at one of our several locations.


The Federal Deposit Insurance Corporation is an agency of independence of the United States government. It covers your account dollar-for-dollar through any date of default for an amount up to – at the minimum – $250,000.

If you have over that amount in your bank, your account will likely be linked to either a trust document or a special deposit that has been established by a third-party broker.

While you may have a short wait to acquire those funds, you will be able to acquire them when they are covered by the FDIC. For additional information on the FDIC and coverage amounts, be certain to obtain the brochure called “Your Insured Deposits”.

Your Funds Are Covered with Us

We here at Somerville Bank know and understand just how important your money is to you. All qualified accounts are fully protected and covered by FDIC insurance.

We now have 8 locations where financial professionals are standing by to assist you with your needs.

For more information on the FDIC, on accounts and financial affairs that we cover, and/or to make an appointment, use the following link to learn more: