[Jester] The Transaction Account Guarantee (TAG) program

[Jester] The Transaction Account Guarantee (TAG) program was created in response to the financial crisis to help settle the nerves of depositors with large bank accounts. It allows participating banks and financial institutions that have non-interest bearing accounts, like some checking accounts, to offer unlimited FDIC coverage, instead of the regular $250,000 coverage per depositor. The additional TAG insurance doesn’t apply to interest-bearing checking accounts, savings accounts, money markets, or CDs.

[Jester] The TAG program has been extended through the end of 2010, but participating institutions had a one-time opportunity to opt out of it by April 30, 2010 and let their coverage expire on July 1, 2010. Over 1,000 institutions decided to get out and save money on the rising expense of the program. If your bank discontinued TAG insurance and you have an account that doesn’t earn interest, then your coverage has simply been reversed back to the FDIC’s general deposit insurance rules. For most people, that isn’t a big deal, because if they had over $250,000 in cash it probably wouldn’t be sitting idle in a non-interest bearing account!