POD CDs & FDIC Insurance Coverage

by Mary Beth Guard, BOL Guru

Question: Help, I'm confused. If we have a $300,000 CD titled Mary Smith POD John Smith and Joe Smith is it insured for $300,000 or $200,000. The way I read the rule it is insured $100,000 per beneficiary but that leaves out the owner of the CD.

Answer: If John and Joe are "qualifying beneficiaries" as to Mary (her spouse, child, grandchild, parent or sibling), the CD will be insured up to $100,000 per qualifying beneficiary on Mary's payable-on-death account.

2 qualifying beneficiaries x $100,000 = $200,000 total insurance coverage.

Mary's interest is NOT insured separately.

First published on BankersOnline.com 11/25/02