DP14 - FDIC InsuranceCoverage

A 282A1909DB80420AB1A790B794C8797B Not answered. The correct answer is A. B, C, and D are incorrect because the FDIC administers the Deposit Insurance Fund (DIF).

5. The FDIC administers a fund which insures deposits held in banks. What fund does the FDIC administer? A. Deposit Insurance Fund (DIF) B. Federal Insurance Fund (FIC) C. Insurance Deposit Fund (IDF) D. Secure Deposit Fund (SDF)

B 77E7EDBAB75E452496E74805243203A4 Not answered. The correct answer is B. A, C, and D are incorrect because the term defined is ''ownership category.''

9. ''A person's share in all of the deposit accounts he or she owns in the same ownership capacity in the same financial institution'' is a definition of which FDIC term? A. Ownership ability B. Ownership category C. Ownership style D. Ownership Insurance Accounts

B 926D4EAD7AB14B2E85C452CBA7AB6AE6 Not answered. The correct answer is B. A is incorrect because the FDIC does not offer additional insurance. C is incorrect because the $25,000 will not be insured at all even for a higher rate. D is incorrect because the only communication Katherine may receive from the bank would be to provide information on FDIC insurance coverage.

1. Katherine has one account at Best Bank. She has just deposited a check for $83,000 into her money market account bringing the balance to $275,000. Assuming Katherine wants to keep her funds in interest bearing accounts, how would the amount over $250,000 be handled under the current FDIC insurance rules? A. Katherine will receive a letter urging her to purchase additional insurance for the $25,000 B. The $25,000 will be uninsured C. The $25,000 will be insured at a higher rate D. Katherine will be asked to move $25,000 out of her account

C 43BE9A6F1BE34C178361D3BD4C5BA302 Not answered. The correct answer is C. A is incorrect because Hazel can name a natural person as a POD beneficiary. B is incorrect because the entire amount of $300,000 would be divided between the beneficiaries and added with any like-ownership accounts to determine insurance coverage. D is incorrect because there is no reason Hazel cannot open just one account and designate multiple beneficiaries.

10. Hazel Smith wants to deposit $300,000 into a CD, payable on her death in equal shares to her niece, Ima Smith and her nephew, Peter Smith. Which statement is true about this account? A. Based on FDIC beneficiary rules, Hazel cannot name her niece and nephew as POD payees B. Hazel can only leave a maximum $250,000 to her niece and nephew C. The bank must ensure that the titling of the account reflects the POD designation D. Hazel should be advised to divide the money in half and open two separate accounts if she wants to name two POD beneficiaries

C 326E62FFEBB847D385305B64AE5AC5E2 Not answered. The correct answer is C. A, B, and D are incorrect because mutual fund accounts and safe deposit boxes are not eligible for FDIC insurance coverage.

10. Ruby has an interest bearing checking account and a safe deposit box at your bank. She would like to open a mutual fund IRA. Which of these accounts is eligible for FDIC insurance? A. The IRA, checking account, and safe deposit box B. The checking account and safe deposit box C. Only the checking account D. Only the IRA

D 35DFEB47AFF744F2AB0E5692A74A679D Not answered. The correct answer is D. A is incorrect because the FSLIC was created to insure thrifts. B is incorrect because BIF and SAIF were created as part of the amendments in FIRREA. C is incorrect because the Federal Deposit Insurance Act did not originally set insurance limits.

10. The Federal Deposit Insurance Act created the FDIC. What primary objective was the FDIC intended to achieve? A. To insure deposits at thrift institutions B. To refinance the efforts of BIF and SAIF C. To increase insurance coverage limits D. To restore confidence in the banking system by providing government insurance for bank deposits

B 45D93F2C57524DB597B61544A97E4C09 Not answered. The correct answer is B. A is incorrect because BIF and SAIF were created as part of the amendments in FIRREA. C is incorrect because the FSLIC was created to insure thrifts. D is incorrect because the Federal Deposit Insurance Act did not originally set insurance limits.

10. Why did the Federal Deposit Insurance Act create the FDIC? A. To refinance the efforts of BIF and SAIF B. To restore confidence in the banking system by providing government insurance for bank deposits C. To insure deposits at thrift institutions D. To increase insurance coverage limits

D 1B677235399E4804962FBCFF18756048 Not answered. The correct answer is D. A and B are incorrect because FDIC insurance coverage of an individual's accounts in any one institution are calculated based on ownership categories. C is incorrect because the client's share of the joint account would be insured separately.

11. A client has three single ownership savings accounts and one joint money market account. Assuming all accounts have balances of $10,000, how does the FDIC calculate the client's insurance coverage for these accounts? A. All four account balances are added together B. All four accounts are separately insured C. The three single accounts are added together and insured. If the total from the three single accounts is less than the insurable amount, funds from the joint account can be added to reach the maximum insurable balance D. The client's three single accounts are added together and insured, and the client's share of the joint account is separately insured

B BA5C9B6710C2424EB7F4221D52D5244F Not answered. The correct answer is B. A, C, and D are incorrect because accounts held in separately chartered financial institutions are not added together and are insured separately.

11. Sarah Smith has single ownership accounts in three separately chartered financial institutions. How is the insurance coverage for Sarah's accounts calculated by FDIC? A. Accounts are aggregated and the total is insured for up to $250,000 B. Each account is insured separately C. The oldest account is insured first D. The account with the largest balance has the priority for insurance coverage

A AEBDE35F9C23488CB2C51E94B5F115E3 Not answered. The correct answer is A. B is incorrect because signage for non-deposit products may not include the FDIC signage logo or statement. C is incorrect because the FDIC signage is not allowed on non-covered products. D is incorrect because insured depository institutions must display the official ''Member FDIC'' signs at each station or window where insured deposits are usually and normally received, both at a depository institution's principal place of business and in all its branches.

11. Your marketing department wants to place a sign in each branch informing customers about your bank's new insurance subsidiary. Which statement is true? A. The Sign must not contain the ''Member FDIC'' logo B. Any advertisement for an insurance product offered by or through the bank must contain the ''Member FDIC'' logo C. Any non-covered product or service must contain the ''Member FDIC'' logo D. ''Member FDIC'' signs are only required at the financial institution's principal place of business

C E410F8B711AB4065B81401656D75C9FC Not answered. The correct answer is C. A, B, and D are incorrect because the FDIC administers the Deposit Insurance Fund (DIF).

12. Deposits held in are insured by a fund administered by the FDIC. What fund does the FDIC administer? A. Federal Insurance Fund (FIC) B. Insurance Deposit Fund (IDF) C. Deposit Insurance Fund (DIF) D. Secure Deposit Fund (SDF)

D D8CA390946A24F24ABAA85924F9AC4E3 Not answered. The correct answer is D. A, B, and C are incorrect because when a bank fails, the FDIC acts as the insurer of the failed bank's deposits and the receiver of the failed bank.

12. The FDIC has many roles. Which option describes two capacities the FDIC performs following a bank failure? A. As the teller at the bank's drive thru and the underwriter of the bank's loans B. As the buyer of the failed bank and the notifier of that bank's customers C. As the closer of safe deposit boxes and the opener of new CD accounts D. As the insurer of the bank's deposits and the receiver of the failed bank

A E2550F1E4F8347E0A3863CD3FABC8643 Not answered. The correct answer is A. B is incorrect because if the CSR sells non-deposit products, the FDIC signage may not be displayed. C is incorrect because the FDIC signage is not required on ''No Parking signs'' because such signs do not advertise bank products. D is incorrect because FDIC signage should not appear on pages that promote non-deposit products and is not required on pages promoting loan products.

12. Which statement regarding FDIC signage is true? A. FDIC insurance signage must be placed where consumer deposits are accepted B. FDIC insurance signage must be placed on every CSR desk and remain there at all times C. FDIC insurance signage must be on the bank's ''No Parking'' signs so customers know the bank is insured D. FDIC insurance signage must be on every page of a bank's website

C E3D67EC0E85F4C41A3479ED92055391D Not answered. The correct answer is C. A is incorrect because commercial account coverage is based on the TIN. B is incorrect because the $250,000 is not temporary. D is incorrect because funds in business accounts are insured.

13. Fred is reviewing his bank account. He has some questions about the coverage on his business account. Which statement regarding that coverage is correct? A. Each business account is insured up to $250,000 B. All accounts are insured temporarily up to $250,000 C. Funds in business accounts are aggregated by the TIN and insured up to $250,000 D. Funds in business accounts are not insured

C 6DE81B366264469B9BF88406CD2624FA Not answered. The correct answer is C. A, B, and D are incorrect because accounts held in separately chartered financial institutions are not added together and are insured separately.

13. Jenny Chen has single ownership accounts in separately chartered North Bank, South Bank, and East Bank. How does the FDIC calculate the insurance coverage for Jenny's accounts? A. The oldest account is insured first B. The account with the largest balance has the priority for insurance coverage C. Each account is insured separately D. Accounts are aggregated and the total is insured for up to $250,000

A 265149E432EF46C49033A824B651843B Not answered. The correct answer is A. B, C, and D are incorrect because HSA accounts that do not name any beneficiaries are insured under the single ownership category.

14. If a depositor opens a Health Savings Account (HSA) and does not name any beneficiaries, how would the FDIC insure the deposit? A. As a single account ownership category B. As an IRA C. As a government account D. As a joint account

D 341B088D04084FD2AD14D76078290ACE Not answered. The correct answer is D. A and C are incorrect because FDIC coverage of an individual's accounts in any one institution are calculated based on ownership categories. B is incorrect because Mr. Kendall's share of the joint account would be insured separately.

14. Mr. Kendall has two single ownership savings accounts and three joint CD accounts with his wife. Assuming all accounts have balances of $10,000, how does the FDIC calculate Mr. Kendall's insurance coverage for these accounts? A. All five accounts are separately insured B. The two single accounts are added together and insured. If the total from the two accounts is less than the insurable amount, funds from the joint accounts can be added to reach the maximum insurable balance C. All five account balances are added together D. Mr. Kendall's two single accounts are added together and insured, and his share of the joint accounts is separately insured

D 26354AAC5EFE48D28A21EA8232D82F5A Not answered. The correct answer is D. A, B, and C are incorrect because a pass-through account is one set up by a third party with funds owned by the principals of the account.

14. When dealing with fiduciary accounts, you may hear the term ''pass-through" deposit insurance coverage. What does that term mean? A. The account is opened by individuals who are passing through the area B. Ownership of the funds passes through the account to the bank C. The FDIC passes the insurance through the account to the FDIC's insurance fund D. Funds in the account are owned by the principal not the third party who set up the account

A DA0D9C90052940AA99B7F602B8C3A909 Not answered. The correct answer is A. B is incorrect because the FDIC does not offer additional insurance. C is incorrect because the only communication Ingrid may receive from the bank would be to provide information on FDIC insurance coverage. D is incorrect because the $25,000 will not be insured at all even for a higher rate.

2. Ingrid has one account at Corner Bank. She has just deposited a check for $180,000 into her money market account bringing the balance to $275,000. How would the amount over $250,000 be handled? A. The $25,000 will be uninsured B. Ingrid will receive a letter urging her to purchase additional insurance for the $25,000 C. Ingrid will be asked to move $25,000 out of her account D. The $25,000 will be insured at a higher rate

A 18224DF0BF604B18A359C6AF4D344368 Not answered. The correct answer is A. B, C, and D are incorrect because mutual funds accounts and safe deposit boxes are not eligible for FDIC insurance coverage.

2. Megan has a mutual fund IRA through your bank. She also has a NOW account, a money market account and a safe deposit box. Which of these accounts is eligible for FDIC insurance? A. The NOW account and the money market B. The IRA, money market, and NOW account C. The NOW account, money market, and safe deposit box D. All of them except the IRA

B 1FCBB5E82B344DC8BA7E5F358FCF4CB9 Not answered. The correct answer is B. A is incorrect because all account balances are aggregated. C is incorrect because all of Simon's corporate accounts are insured, but only to an aggregate maximum of $250,000. D is incorrect because bank money market accounts are insured.

2. Simon is a customer of your bank. He has five business accounts for Simon Sez, Inc., with your bank: two operating accounts, two payroll accounts, and a commercial money market savings account. All four checking accounts are noninterest bearing deposit accounts and the money market earns a rate of 2.5 percent APY. Which statement is true? A. Only the checking accounts are aggregated - the money market is insured separately B. All accounts are aggregated because they are under the same ownership and the maximum insurance is $250,000 C. Each account is separately insured up to $250,000 D. The checking accounts are insured but the money market is not

A F86C3CAEFCA34BD2B08B50A011E9B1CA Not answered. The correct answer is A. B is incorrect because BIF and SAIF were created as part of the amendments in FIRREA. C is incorrect because the Federal Deposit Insurance Act did not originally set insurance limits. D is incorrect because the FSLIC was created to insure thrifts.

2. What is the primary reason the Federal Deposit Insurance Act created the FDIC? A. To restore confidence in the banking system by providing government insurance for bank deposits B. To refinance efforts of BIF and SAIF C. To increase insurance coverage limits D. To insure deposits at thrift institutions

B 0B233E8C715A4903A92673E6536F3489 Not answered. The correct answer is B. A, C, and D are incorrect because the FDIC administers the Deposit Insurance Fund (DIF).

3. One of the FDIC's most important functions is to insure the deposit accounts of millions of Americans in all the FDIC-insured financial institutions across the country. What fund does the FDIC administer? A. Federal Insurance Fund (FIC) B. Deposit Insurance Fund (DIF) C. Insurance Deposit Fund (IDF) D. Secure Deposit Fund (SDF)

B E21E536090604CB58D8AD2874FFBD044 Not answered. The correct answer is B. A, C, and D are incorrect because HSA accounts that do not name any beneficiaries are insured under the single ownership category.

4. A Health Savings Account (HSA), like any other deposit, is insured based on who owns the funds and whether beneficiaries have been named. If a depositor opens an HSA and does not name any beneficiaries, how would the FDIC insure the deposit? A. As an IRA B. As a single account ownership category C. As a government account D. As a joint account

C BD1CF3705A97492E87CA6885A0699722 Not answered. The correct answer is C. A is incorrect because commercial account coverage is based on the TIN. B is incorrect because the $250,000 is not temporary. D is incorrect because funds in business accounts are insured.

4. FDIC insurance coverage has Mrs. Frederick very confused. She is on the phone and asking you some questions about coverage on her business account. Which statement is correct? A. Each business account is insured up to $250,000 B. All accounts are insured temporarily up to $250,000 C. Funds in business accounts are aggregated by the TIN and insured up to $250,000 D. Funds in business accounts are not insured

A 27644767674F4480BF7282CB424963E1 Not answered. The correct answer is A. B, C, and D are incorrect because accounts held in separately chartered financial institutions are not added together and are insured separately.

4. James Johnson has single ownership accounts in two separately chartered financial institutions. How does FDIC calculate the insurance coverage for James' accounts? A. Each account is insured separately B. Accounts are aggregated and the total is insured for up to $250,000 C. The oldest account is insured first D. The account with the largest balance has the priority for insurance coverage

A 3A9B8C1A672C4AC5A71F519904D43579 Not answered. The correct answer is A. B and C are incorrect because FDIC insurance coverage of an individual's accounts in any one institution is calculated based on ownership categories. D is incorrect because Katy's share of the joint account would be insured separately.

4. Katy McGuire is concerned about the insurance coverage on her funds with your bank. Katy has two single ownership savings accounts and one joint money market account with her brother. Assuming all accounts have balances of $10,000, how does the FDIC calculate Katy's insurance coverage for these accounts? A. The two single accounts are added together and insured: Katy's share of the joint account is separately insured B. All three account balances are added together C. All three accounts are separately insured D. The two single accounts are added together and insured. If the total from the two accounts is less than the insurable amount, funds from the joint account can be added to reach the maximum insurable balance

D B5E2B667D58F49CBB52A5D0148A285B8 Not answered. The correct answer is D. A is incorrect because Marilyn can name a natural person as a POD beneficiary. B is incorrect because there is no reason Marilyn cannot open just one account and designate multiple beneficiaries. C is incorrect because the entire amount of $300,000 would be divided between the beneficiaries and added with any like-ownership accounts to determine insurance coverage.

5. Marilyn wants to deposit $300,000 into a CD, payable on her death in equal shares to her niece, Jan and her nephew Peter. Which statement is true about this account? A. Based on FDIC beneficiary rules, Marilyn cannot name her niece and nephew as POD payees B. Marilyn should be advised to divide the money in half and open two separate accounts if she wants to name two POD beneficiaries C. Marilyn can only leave a maximum $250,000 to her niece and nephew D. The bank must ensure that the titling of the account reflects the POD designation

B AB69636ED54D4A768B2B9CF3311EB241 Not answered. The correct answer is B. A, C, and D are incorrect because a pass-through account is one set up by a third party with funds owned by the principals of the account.

5. What does that term ''pass-through" deposit insurance coverage mean? A. The account is opened by individuals who are passing through the area B. Funds in the account are owned by the principal not the third party who set up the account C. Ownership of the funds passes through the account to the bank D. The FDIC passes the insurance through the account to the FDIC's insurance fund

C 261C8447AD2D45C0A907EF5B977C4FAB Not answered. The correct answer is C. A, B, and D are incorrect because a pass-through account is one set up by a third party with funds owned by the principals of the account.

5. With fiduciary ownership, you may hear the term ''pass-through" deposit insurance coverage. What does that term mean? A. The account is opened by individuals who are passing through the area B. Ownership of the funds passes through the account to the bank C. Funds in the account are owned by the principal not the third party who set up the account D. The FDIC passes the insurance through the account to the FDIC's insurance fund

A 63AA4C0204044BBD9C4556A8B8F5C3E2 Not answered. The correct answer is A. B, C, and D are incorrect because when a bank fails, the FDIC acts as the insurer of the failed bank's deposits and the receiver of the failed bank.

6. One of the FDIC's most important functions is to insure the deposit accounts of millions of Americans in all the FDIC-insured financial institutions across the country. Which option describes two capacities the FDIC performs following a bank failure? A. As the insurer of the bank's deposits and the receiver of the failed bank B. As the teller at the bank's drive thru and the underwriter of the bank's loans C. As the buyer of the failed bank and the notifier of that bank's customers D. As the closer of safe deposit boxes and the opener of new CD accounts

A 19BEE64DE4DD41DEB1D1F09243845C43 Not answered. The correct answer is A. B is incorrect because any advertisement for a non-deposit investment product may NOT contain this logo. C is incorrect because advertisements for any non-covered product or service may NOT contain this logo. D is incorrect because insured depository institutions must display the official ''Member FDIC'' signs at each station or window where insured deposits are usually and normally received, both at a depository institution's principal place of business and in all its branches.

6. Your marketing department wants to place an advertisement in your branch promoting a new deposit product. Which statement provides accurate signage instructions? A. Signage must contain the ''Member FDIC'' logo B. Any advertisement for a non-deposit investment product must contain the ''Member FDIC'' logo C. Any non-covered product or service must contain the ''Member FDIC'' logo D. ''Member FDIC'' signs are only required at the financial institution's principal place of business

B 6E9450CD87CD452B973434DB3CE25EDF Not answered. The correct answer is B. A, C, and D are incorrect because when a bank fails, the FDIC acts as the insurer of the failed bank's deposits and the receiver of the failed bank.

7. A bank failure is the closing of a bank by a federal or state banking regulatory agency, generally resulting from a bank's inability to meet its obligations to depositors and others. Which option describes two capacities the FDIC performs following a bank failure? A. As the teller at the bank's drive thru and the underwriter of the bank's loans B. As the insurer of the bank's deposits and the receiver of the failed bank C. As the buyer of the failed bank and the notifier of that bank's customers D. As the closer of safe deposit boxes and the opener of new CD accounts

C 45A13195BC134C34B7B8E3CC786A86A6 Not answered. The correct answer is C. A is incorrect because bank money market accounts are insured. B is incorrect because all account balances are aggregated. D is incorrect because all of Fred's corporate accounts are insured, but only to an aggregate maximum of $250,000.

7. Fred has five business accounts with your bank for Freddie's Fries, LLC: two operating accounts, two payroll accounts, and a commercial money market savings account. Which statement concerning business entity insurance is generally true? A. The checking accounts are insured but the money market is not B. Only the checking accounts are aggregated - the money market is insured separately C. All Fred's accounts are aggregated because they are under the same ownership and the maximum insurance is $250,000 D. Each account is separately insured up to $250,000

A CF552603A76347E18EAA9DB1D5DB2A96 Not answered. The correct answer is A. B is incorrect because all account balances are aggregated. C is incorrect because bank money market accounts are insured. D is incorrect because all of Pete's corporate accounts are insured, but only to an aggregate maximum of $250,000.

7. Pete has a retail business that is a for-profit corporation: Peter Piper, Inc. He has five business accounts with your bank; two operating accounts, two payroll accounts, and a commercial money market savings account. All four checking accounts are noninterest bearing deposit accounts and the money market earns a rate of 2.5 percent APY. Which statement is true? A. All of the accounts are aggregated because they are under the same ownership and the maximum insurance is $250,000 B. Only the checking accounts are aggregated - the money market is insured separately C. Each account is separately insured up to $250,000 D. The checking accounts are insured but the money market is not

D C0D49D2DE3014CDDA9CF267B8B3B0480 Not answered. The correct answer is D. A, B, and C are incorrect because the term defined is ''ownership category.''

8. Donny's share in all the deposit accounts he owns is in Dalton Bank and in the same ownership capacity. This is a definition of which FDIC term? A. Ownership ability B. Ownership style C. Ownership Insurance Accounts D. Ownership category

B F633F8A87CB84985BB09A6D5F40EDAFF Not answered. The correct answer is B. A, C, and D are incorrect because mutual fund accounts and safe deposit boxes are not eligible for FDIC insurance coverage.

8. Larry has a mutual fund IRA through your bank. He also has an interest bearing checking account, a money market account and a safe deposit box. Which accounts are eligible for FDIC insurance? A. The IRA, money market and the checking B. The checking and money market C. The checking, money market, and safe deposit box D. All of them except the IRA

C 47ECE9AC00D6462DB2C18CE90D772A61 Not answered. The correct answer is C. A is incorrect because the $30,000 will not be insured at all, even for a higher rate. B is incorrect because the only communication Maria may receive from the bank would be to provide information on FDIC insurance coverage. D is incorrect because purchasing additional insurance is not an option.

8. Maria has just received an inheritance, which she has deposited into her money market account at the bank. This brings her account total to $280,000. How would the amount over $250,000 be handled? A. The $30,000 will be insured at a higher rate B. Maria will be asked to move $30,000 out of her account C. The $30,000 will be uninsured D. Marie will receive a letter urging her to purchase additional insurance for the $30,000

B D8752EEF68074ED1A6B9E73BD0CCEEDA Not answered. The correct answer is B. A is incorrect because Mike can name his nephews as POD beneficiaries. C is incorrect because the entire amount of $300,000 would be divided between the beneficiaries and added with any like-ownership accounts to determine insurance coverage. D is incorrect because there is no reason Mike cannot open just one account and designate multiple beneficiaries.

8. Mike Smith wants to deposit $300,000 into a CD, payable on his death in equal shares to his nephews, John and Paul. Which statement is true about this account? A. Based on FDIC beneficiary rules, Mike cannot name his nephews as POD payees B. The bank must ensure that the titling of the account reflects the POD designation C. Mike can only leave a maximum $250,000 to his nephews D. Mike should be advised to divide the money in half and open two separate accounts if he wants to name two POD beneficiaries