The portion of a bank deposit that a government guarantees up to a legal limit is called an insured deposit.
Deposit insurance protects eligible depositors if a participating bank fails. Coverage normally applies only up to a specified limit and only to qualifying account categories, such as checking, savings, and certain time deposits. The exact insurer, limit, and eligible products vary by country.
In the United States, the Federal Deposit Insurance Corporation generally insures eligible deposits up to $250,000 per depositor, per insured bank, for each ownership category. Securities, mutual funds, and many investment products are not insured deposits, even if a bank sells or holds them.
Deposit insurance is different from a bank’s own capital or reserve funds. It is a protection framework intended to preserve confidence in the banking system and reduce the risk of panic withdrawals. Customers must still check whether an institution and account type qualify.