What Is the National Credit Union Association (NCUA)?

Established by the US Congress in 1970, the National Credit Union Administration (NCUA) provides up to $250,000 of federal share insurance to millions of credit union account holders. At Patelco, your money is insured by the NCUA up to $250,000 per member, per account type.

What is NCUA insurance ?

The National Credit Union Share Insurance Fund (NCUSIF) insures members’ deposits in federally insured credit unions, insuring individual accounts up to $250,000. If you hold a joint account, the NCUSIF insures up to $250,000 per account owner.

The NCUSIF has the backing of the full faith and credit of the United States — and according to the NCUA, credit union members have never lost a penny of insured savings at a federally insured credit union.¹

NCUA vs. FDIC

The NCUA is an independent government agency with a board of directors appointed by the president and approved by the Senate. It regulates credit unions, insures credit union deposits, and protects the members of credit unions. All federal and most state-chartered credit unions are members of the NCUA.

Meanwhile, the Federal Deposit Insurance Corporation (FDIC) is a separate government agency. Created after the banking crisis in 1933, it insures deposits at more than 5,000 banks and savings associations.

As noted, the NCUA insures deposit accounts at credit unions for up to $250,000 per account. Similarly, the FDIC insures up to $250,000 per account at FDIC-insured financial institutions.

What types of accounts are covered by NCUA insurance ?

The National Credit Union Share Insurance Fund (NCUSIF) provides all members of federally insured credit unions with $250,000 in coverage for single ownership accounts.

Accounts include:

• Share savings accounts
• Checking accounts (also called “share draft accounts”)
• Money market accounts
• Share certificates

An individual with account balances of $250,000 or less at the same credit union is fully insured. If your account balances total more than $250,000 at your credit union, additional share insurance may be available, depending on account type. (If you’re unsure of your coverage, please contact us.)

The NCUSIF also covers traditional and Roth individual retirement accounts (IRAs), Keogh retirement accounts, joint accounts, and revocable and irrevocable trust accounts. Each of your NCUA-insured accounts is covered, so if you have a savings account, a Roth IRA and a revocable trust account at the same credit union, NCUSIF insures your savings account for up to $250,000, your IRA for up to an additional $250,000, and your trust for up to an additional $250,000.²

The NCUSIF does not cover losses on money invested in mutual funds, stocks, bonds, life insurance policies, and annuities.

What are the requirements for NCUA insurance ?

Before you open an account at a credit union, make sure the credit union is federally insured by the NCUA. All Patelco members are covered by NCUA insurance. The NCUA regulates which types of accounts can be insured, how accounts can be opened and closed, how interest may be paid, and the fee structure for accounts.

For a credit union to a member of the NCUA, it must:

• Be federally insured
• Meet certain financial standards
• Have a board of directors composed of elected members
• Have a written charter that sets forth its purpose and mission
• Have a written set of bylaws that govern its operations.

If a credit union does not meet any of the NCUA’s requirements, it may lose its insurance coverage. This means that depositors at the credit union would not be protected if the credit union were to fail.

You can rest assured that Patelco meets all the requirements above, and your accounts at Patelco are insured.

What happens when a credit union fails ?

It’s unlikely that your credit union will fail, but if it does, you will not lose any of your money up to $250,000, per account type. The NCUA typically begins to return your insured funds (as a check or direct deposit) within five days of the failure.

If a credit union fails, the NCUA will try to find another credit union to take over the failed credit union’s assets and liabilities. If that’s not possible, the NCUA will liquidate the failed credit union’s assets and use the proceeds to pay back the insured depositors.

If you have more than $250,000 in your credit union account, you may want to talk to us about what your specific coverage is.