<<back to Hot Topics

Recently, a turbulent economy has made many consumers worry about the safety of their funds housed in their financial institution. As a General Electric Credit Union (GECU) member, you can rest assured that your funds are safe and secure. We take pride in being one of the most sound financial institutions in the country and make your interests our number one priority.

Our outstanding performance has been recognized by BauerFinancial Inc., one of the most respected organizations in the country in the financial industry. They are responsible for ranking financial institutions’ performance based on financial responsibility, strength, and safety. This ranking is applied to a 5-star rating system; the 5-star rating is awarded to financial institutions with the highest level of performance. For the past 18 years, GECU has achieved the 5-star Superior rating – something only 10% of financial institutions receive.

Not only have we been ranked as one of the top financial institutions in the country, we also take every precaution possible to protect your accounts. As you know, we are insured by the National Credit Union Administration (NCUA), but you may not fully be aware of what that entails and how that offers you security and peace of mind.

What is the NCUA?
The NCUA is a federal government agency that charters and supervises credit unions. It also operates and manages the National Credit Union Share Insurance Fund (NCUSIF). Backed by the U.S. government, the NCUSIF insures the accounts of the majority of state-chartered credit unions. We are one of these state-chartered credit unions insured by the NCUSIF.

Why is NCUSIF Share Insurance Coverage Important?
Share insurance coverage, offered through the NCUSIF, protects members against losses if a federally insured credit union should fail. You can confidently join and conduct business with a federally insured credit union, such as GECU, because no member has ever lost money insured by the NCUSIF.

Failures of insured credit unions, however, are rare because only those with sound operational standards, such as GECU, qualify to receive NCUSIF coverage. NCUA also works closely with state regulatory authorities to evaluate federally insured state-chartered credit unions.

What Basic Coverage is Provided by the NCUSIF?
The NCUSIF provides you with $100,000 in coverage for your individual accounts. These accounts include your: regular shares, share drafts (checking accounts), money market accounts, and share certificates. If your account balances total $100,000 or less, you still have full NCUSIF coverage. If you have more than $100,000, several options are available for additional coverage because, as discussed in greater detail below, the NCUSIF provides separate insurance for other types of accounts.

Does the NCUSIF Provide Additional Coverage?
You have options for coverage that is separate from and in addition to the coverage available to your individual accounts. The following are such accounts.

Retirement Accounts: If you have a traditional and/or Roth Individual Retirement Account (IRA), you have additional coverage beyond your individual accounts. Under rules that became effective April 1, 2006, the NCUSIF now insures traditional and Roth IRAs in the aggregate for $250,000.

As an example, if you have a regular share account and an IRA, the NCUSIF insures the regular share account for up to $100,000 and the IRA for up to an additional $250,000.

The increase to $250,000 for retirement account protection is important because you may have accumulated more than $100,000 during a long career to save for retirement.

Joint Accounts: If you are a joint account holder with another individual, the NCUSIF provides you with $100,000 in coverage for your aggregate interest. For example, if you and your spouse have a joint account, you have $200,000 in coverage. This coverage is also separate from and in addition to the coverage available for other accounts such as individual accounts and retirement accounts.

Trust Accounts: The NCUSIF provides separate coverage for both revocable and irrevocable trusts. Credit unions can establish a common revocable trust payable-on-death (POD) account without additional documentation; however, some trusts require additional, valid documentation to qualify for coverage. Consult with an IRA specialist by calling: 513.243.4328 or 800.542.7093 to properly establish and document trust arrangements.

Revocable Trusts: If you own a revocable trust account, you may qualify for insurance coverage of up to $100,000 per beneficiary you named that is separate from the individual coverage available to you as the trust owner. The beneficiaries must be your: spouse, child, grandchild, parent, brother, or sister. For example, if you have a revocable trust for $300,000 and you name a spouse and two children as your beneficiaries, the entire $300,000 would have separate NCUSIF coverage ($100,000 per beneficiary). This coverage is also separate from the coverage provided for other types of accounts you may have at the credit union.

Irrevocable Trusts: Funds placed in an account under an irrevocable trust have separate coverage based on the beneficial interest under such trust. The interest of each beneficiary in an account (or accounts) established as an irrevocable trust has separate NCUSIF coverage of $100,000. In cases where a beneficiary has an interest in more than one trust arrangement, created by the same owner, the interests of the beneficiary in all accounts established under such trusts are added together for insurance purposes and insured for a total of $100,000. That is also separate from and in addition to the coverage the NCUSIF provides for other types of accounts.

As your trusted credit union, our goal is to provide you the best products, services, and protection!

For full details on NCUA protection, please reference their "Your Insured Funds" brochure. They also provide a Share Insurance Estimator if you would like to calculate the coverage on your accounts.

You may also contact the credit union at: 513.243.4328 or 800.542.7093 or by email at: memberservices@gecreditunion.org, to further discuss the safety and security of your funds.

Source: www.ncua.gov, "How Your Accounts Are Insured," November 8, 2007, http://www.ncua.gov/Publications/brochures
/FCUFacts/HowAccountInsured.pdf

<<back to Hot Topics