Think your Deposits Are Safe? They Are!

How your funds are insured

Did you know that your Fairfield County Federal Credit Union funds are insured? The National Credit Union Administration (NCUA), a federal government agency, insures each account up to $250,000 through the National Credit Union Share Insurance Fund (NCUSIF). Banks and savings institutions are similarly insured by the Federal Deposit Insurance Corporation (FDIC).

Although the NCUSIF is comparable to the FDIC in its function, it differs in one important fact: all federally insured credit unions have made a one-time deposit of 1 percent of their insured balances into the NCUSIF fund. This is known as "capitalization" of the fund.

Capitalizing the NCUSIF in this way has eliminated the need for credit unions to strengthen the fund by paying costly premiums twice a year. There is no need to "strengthen" the fund. It’s as strong as it can be. Not only that, the 1 percent deposit is treated as an asset, whereas premiums are treated as an expense.

The NCUA, which regulates all credit unions, believes that this capitalization makes the credit union deposit insurance fund stronger than the FDIC banking fund. In other words, your credit union deposits are more secure than ever.