Deposit Insurance for Retirement Accounts and Health Savings Accounts

The tax label on an account and the deposit-insurance category are separate questions. Some retirement deposits receive coverage under a special category, while a health savings account's ownership and beneficiary arrangements affect how it is insured. This guide explains those distinctions and shows why investment assets inside an account should not be confused with insured bank deposits. It helps savers determine which balances are combined when reviewing coverage at one bank.

Adapted from public-domain educational material published by FDIC. Fynoptic has organized and edited the material and added introductory and practical guidance. Sources were reviewed on October 28, 2026; original publication dates, where available, are listed below.

Certain Retirement Accounts

Certain Retirement Accounts (12 C.F.R. § 330.14(b)(2))

I. Definition

In general, Certain Retirement Accounts are self-directed retirement deposits for which an owner and not a plan administrator has the right to direct how the funds are invested.

This category consists of deposits made in connection with the following:

• All types of IRAs, including:
  • Traditional IRAs
  • Roth IRAs
  • Simplified Employee Pension (“SEP”) IRAs
  • Savings Incentive Match Plans for Employees (“SIMPLE”) IRAs
• All Section 457 deferred compensation plans, such as eligible deferred compensation plans provided by state and local governments, regardless of whether they are self-directed;
• Self-directed defined contribution plans, including:
  • Self-directed 401(k) plans
  • Self-directed SIMPLE IRAs held in the form of 401(k) plans
  • Self-directed defined contribution money purchase plans
  • Self-directed defined contribution profit-sharing plans
• Self-directed Keogh plans (or H.R. 10 plans) designed for self-employed individuals.

II. Insurance Limit

Deposits in all Certain Retirement Accounts owned by the same depositor and held at the same insured bank are added together and the total is insured for up to $250,000.

Naming beneficiaries does not increase deposit insurance coverage for Certain Retirement Accounts.

III. Requirements

In general, the retirement plans in this category are self-directed. However, deposits held in 457 deferred compensation plans are insured as “Certain Retirement Accounts” even if they are not self-directed.

A retirement plan is considered “self-directed” for the purpose of FDIC deposit insurance coverage if each plan participant can choose the specific insured bank to hold their retirement deposits. Sometimes a retirement plan lists a specific insured bank as the default institution. Provided that the participants can change the default insured bank, the plan is considered self-directed.

In other instances, a plan may have a default insured bank that cannot be changed. These types of plans can be considered self-directed if plan participants can make their own investment decisions. For example, a retirement plan lists Bank ABC as the default insured bank. Plan participants cannot change the insured bank. But participants can also choose to invest in stocks, bonds or mutual funds. When plan participants can make these types of investment decisions, their plan is self-directed.

Example 4

Facts:

Barbara Moore has two IRA CDs at the same insured bank. She has listed two IRA beneficiaries on each CD.

Rules:

1. All certain retirement accounts owned by the same person at the same insured bank are aggregated and the total is insured up to $250,000.
2. Listing beneficiaries on IRAs, while valid to designate the transfer of funds when the owner dies, does not increase deposit insurance coverage.
3. An individual’s deposits in this category are added together and insurable up to $250,000 per insured bank.

Answer:

Since Barbara has multiple IRAs at the same insured bank, the balances are added together and insured for up to $250,000. The fact that she named beneficiaries on the IRAs does not increase her coverage. With $280,000 on deposit in her IRAs at the same insured bank, Barbara is insured for $250,000 and uninsured for $30,000.

IV. When the Owner of an IRA Dies

Depositors typically name a beneficiary on their IRA. While listing beneficiaries on an IRA does not increase the coverage, once the owner dies, a decedent IRA raises the issue of how such an account would be insured.

In some cases, the IRA may continue to be titled in the name of the deceased owner. If an IRA continues to be maintained in the decedent’s name, and continues to be recognized by the IRS as the decedent’s IRA, then the FDIC will insure the account for up to $250,000 as a certain retirement account of the decedent. In this instance, the deposit would not be aggregated with any deposits maintained by the beneficiary at the same insured bank.

In other cases, the IRA might be restructured so that the funds are held in the name of the beneficiary or beneficiaries of that IRA, often referred to as an inherited IRA. In that case, the FDIC will insure the account(s) as a certain retirement account of the named owner. The funds would be aggregated with any other certain retirement account deposits of the named owner at the same insured bank and insured up to the $250,000 limit.

Example 5

Facts:

John and Mary Law each had an IRA CD at Any Bank. They do not have any other retirement accounts at Any Bank. John listed Mary as his sole beneficiary. While John and Mary were both alive, the accounts were insured separately up to $250,000. John died one month ago in February and Mary has continued to maintain John’s IRA in his name.

Rule:

When an IRA owner dies and the IRA continues to be maintained in the decedent’s name, the decedent’s IRA is insured up to $250,000 separately from the beneficiary’s own IRA at the same insured bank.

Answer:

Each owner is insured for up to $250,000 for all IRAs held at the same insured bank. Therefore, Mary is insured for up to $250,000 for her IRA. In addition, at the same insured bank, since Mary kept John’s IRA titled in his name, John’s IRA continues to be insured separately.

V. Types of Retirement Plans NOT Insured as Certain Retirement Accounts

Deposit accounts held by the following types of retirement plans do not qualify as “Certain Retirement Accounts” and are not insured in this category:

• 403(b) plans (e.g., annuity contracts for some public school employees, tax-exempt organizations, and ministers);
• Defined benefit plans; or
• Defined contribution plans, such as 401(k) plans, which are not self-directed.

Please note that this list is not meant to be exhaustive and includes only some retirement plans that are insured as Employee Benefit Plan Accounts.

In addition, Coverdell Education Savings Accounts, sometimes referred to as Education IRAs, are insured as trust accounts.

Health Savings Accounts

Health Savings Accounts

I. Definition

A Health Savings Account (“HSA”) is a tax-exempt trust or custodial account established with a qualified HSA trustee, such as an insured bank, to pay or reimburse certain medical expenses. Interest earned on an HSA is tax-free. In addition, tax-free withdrawals may be made for qualified medical expenses. Unused funds and interest are carried over, without limit, from year to year.

II. Insurance Limit

The FDIC does not recognize HSAs as a unique deposit insurance category. HSAs are insured based on who owns the funds and whether beneficiaries are named in the insured bank account records. These accounts could be insured under one of the following deposit insurance categories depending on whether beneficiaries are listed:

1. Trust Acccounts category
2. Single Accounts category

III. Deposit Insurance Category

1. HSAs as Trust Accounts

In order to identify the applicable deposit insurance category for an HSA, the FDIC will determine whether the deposit has testamentary language identifying one or more eligible beneficiaries to receive the HSA deposit funds when the owner dies. If valid testamentary language exists with one or more beneficiaries named, then the FDIC will insure the deposit under the Trust Accounts category. In general, coverage for trust accounts depends on the number of owners and the number of beneficiaries. For example, if John Smith deposited $750,000 at XYZ Bank and established an HSA where he identified his three children as beneficiaries of the HSA, then John Smith would be insured for up to $750,000. Using the formula for determining coverage for a trust account, his coverage would be calculated as follows:
1 owner x 3 beneficiaries x $250,000 = $750,000.

2. HSAs as Single Accounts

If an owner of an HSA has not designated beneficiaries, then the FDIC will insure the HSA as the single account of the owner. The insurance limit would be up to $250,000 for all single accounts, including any HSAs that a depositor has at the same insured bank.

3. Aggregation with Other Trust Accounts or Single Accounts

In calculating the deposit insurance coverage for an HSA that identifies beneficiaries, the FDIC will aggregate the funds of the HSA with the owner’s other Trust Accounts. Thus, in the earlier example, if John Smith has named his three children as beneficiaries on his HSA and also has named those same children as POD beneficiaries on a savings account at the same insured bank, the FDIC would combine those accounts and John’s total coverage would be $750,000. If John deposited more than $750,000 between the two accounts combined, then he would have uninsured funds.

Similarly, if the HSA is established without any beneficiaries, then those deposits would be combined with any other single accounts that the depositor has at the same insured bank and insured for up to $250,000.

IV. Titling Requirement

The FDIC does not require “POD” or “ITF” to be included in the account title for an HSA to be eligible for Trust Account coverage. If the HSA deposit has testamentary language naming beneficiaries, then the FDIC will accept any of the following terms: “Health Savings Account Trust,” “Health Savings Account” (without the word “trust”) or “HSA.” In regard to the requirement that the beneficiaries of an informal revocable trust account must be named in the insured bank’s account records, the listing of the beneficiaries in the insured bank’s HSA application form or elsewhere in the insured bank’s records would be acceptable.

Putting this into practice

Start by separating deposits from securities or other investments, then identify the ownership category for each deposit. Check beneficiary designations and whether multiple retirement deposits are held at the same bank. Tax advantages do not tell you how much of the balance is insured.

Sources and further reading

• Certain Retirement Accounts — FDIC
• Health Savings Accounts — FDIC