Other Share Insurance Questions
No. A federal credit union cannot be chartered or retain its charter unless it is insured by the NCUSIF.
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Yes. A state-chartered credit union can terminate its NCUSIF share insurance, but it must obtain the approval of its members and the NCUA Board. When a state credit union converts its NCUSIF share insurance to another licensed share insurance program, NCUSIF share insurance terminates upon conversion. If the state credit union does not provide for another share insurance program, NCUSIF share insurance remains in effect for one year following the effective date of termination, but coverage may be reduced depending upon account activity during the one year period.
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NCUA publishes an Annual Report which covers the operations of the NCUSIF. This report is sent to each insured credit union and is also available from each regional director. The report includes financial statements and an independent audit of the Fund’s records.
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At the end of the 18-month insurance period, unclaimed funds are no longer insured, and share account balances are paid based on liquidation and other recoveries. The funds are generally held by NCUA and are available as long as the records of the credit union are available or until the charter or insurance certificate is canceled. In some cases funds may be transferred to a state unclaimed property section for a period of time.
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