Share Insurance; Let Them Eat Cake
Yesterday, NCUA held a webinar to educate credit unions about all the recent share insurance changes. NCUA indicated the following:
- They will issue another FAQ document once they sort through all the attendee questions. Don't hold your breath, as more than 3,300 watched the webinar.
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Even though the revocable trust interim final rule was written using the old insurance amount of $100,000, recent changes have increased that amount to $250,000 per beneficiary. In addition, the interim final rule indicates that there are different requirements when a revocable trust has more than $500,000 on deposit and more than five different beneficiaries. Due to the changes noted above, the threshold is now $1.25 million and more than 5 different beneficiaries.
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 NCUA was not able to give clear guidance regarding if and when credit unions must replace existing share insurance decals or signs. But NCUA did encourage credit unions to use new signage as soon as possible to inform consumers. Stay tuned. That being said, NCUA made electronic copies of the amended signs available here.
One final note: it is a good idea to remind members that changing the structure of their accounts to increase share insurance protection may have unintended consequences. For example, adding someone as a joint owner has benefits and drawbacks. I recall many awkward conversations with members who were SHOCKED to learn that a joint owner had complete access to account funds. Also, adding extra beneficiaries to iincrease share insurance is fine. But members need to understand that if something terrible happens, credit unions will act on that decision.Â
Adding Senators Obama and McCain as beneficiaries on my account surely would increase potential coverage by $500,000, and it would an interesting thing to mention at cocktail parties. But the humor would quickly evaporate if I were hit by a bus.Â
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My coworker Carrie is about to head out on maternity leave. We threw her a little farewell party on Tuesday. Another coworker, Kristina, created a diaper cake for the party. It is a cake made out of ... diapers. Parents disassemble the cake as needed. I hear new parents tend to go through those things. If you haven't seen a diaper cake, take a look at this gem. I told Kristina she should start a business.
