Updated August 3, 2026. Quick answer: naming payable-on-death beneficiaries is the cheapest way to raise deposit insurance — $250,000 per beneficiary, up to five, so $1,250,000 per grantor at one bank. It takes a form at the branch and costs nothing. The trap is that since 2024 a POD account and a living trust at the same bank share that allowance rather than stacking.
What a POD account is, in the regulation’s words
A payable-on-death account is an informal revocable trust: “a trust under which a deposit passes directly to one or more beneficiaries upon the depositor’s death without a written trust agreement, commonly referred to as a payable-on-death account, in-trust-for account, or Totten trust account” (12 CFR 330.10(a)(1)). That is the same category a written living trust sits in.
The multiplication, worked
- One beneficiary — $250,000
- Two — $500,000
- Three — $750,000
- Four — $1,000,000
- Five — $1,250,000
- Six or more — still $1,250,000. The cap is five.
This sits on top of your single-ownership and joint coverage at the same bank, because trust-category coverage is separate from other categories there (12 CFR 330.10(b)(3)).
The 2024 change that broke the standard advice
The advice you will still find published almost everywhere is to open a payable-on-death account and a living trust account at the same bank, on the theory that they sit in different categories and therefore stack. That stopped working. The FDIC now aggregates them: informal revocable trusts (payable-on-death, in-trust-for, Totten), formal revocable trusts (living and family trusts) and irrevocable trusts from the same grantor are one category at one bank — and the whole category is capped at five beneficiaries.
The regulation is blunt about it: trust deposits that pass from the same grantor “are aggregated for purposes of determining coverage under this section, regardless of whether those deposits are held in connection with an informal revocable trust, formal revocable trust, or irrevocable trust” (12 CFR 330.10(b)(2)). So $250,000 × five beneficiaries — $1,250,000 per grantor per bank — is the ceiling on that whole category, no matter how many separate trust documents you sign.
Three things that quietly reduce the number
Beneficiaries have to be ones genuinely expected to receive the funds — the count is of eligible beneficiaries, not names on a form. Where a trust has multiple grantors and the bank’s records say nothing else, the deposit is presumed owned in equal shares (12 CFR 330.10(b)(4)), so what the account records say matters. And the allowance is per grantor per bank: five beneficiaries at three banks is three separate allowances, which is usually the simpler path.
What it does not do
A POD designation moves the money outside probate for that account and raises the insurance ceiling. It does not create a plan. It overrides your will for that account, it has no contingency if the beneficiary dies first unless you name one, and it distributes outright with no conditions — see why the designation beats the will and the equivalent for real property.
The full category table: how to insure more than $250,000. If you have a trust: does a living trust change FDIC coverage.
Every coverage figure on this page is read from the regulation itself — 12 CFR part 330 (FDIC) and part 745 (NCUA) via the official eCFR, the Federal Register for rules not yet in force, and SIPC’s own statement of what it covers. General information, not legal or financial advice; confirm your own position with your institution or the FDIC’s EDIE tool before relying on it.