Account Protection

What is SIPC?

The Securities Investor Protection Corporation (SIPC) is a nonprofit organization that protects stocks, bonds, and other securities in case a brokerage firm goes bankrupt and assets are missing. The SIPC will cover up to $500,000 in securities, including a $250,000 limit for cash held in a brokerage account.

What Fidelity accounts are covered?

All Fidelity brokerage accounts are covered by SIPC. This includes money market funds held in a brokerage account since they are considered securities. Learn more about SIPC coverage at www.sipc.org

Excess of SIPC

In addition to SIPC protection, Fidelity provides its brokerage customers with additional "excess of SIPC" coverage. The excess coverage would only be used when SIPC coverage is exhausted. Like SIPC, excess protection does not cover investment losses in customer accounts due to market fluctuation. It also does not cover other claims for losses incurred while broker-dealers remain in business. For example, fraud claims would not be covered if the brokerage firm was still in operation. Total aggregate excess of SIPC coverage available through Fidelity's excess of SIPC policy is $1 billion. Within Fidelity's excess of SIPC coverage, there is no per customer dollar limit on coverage of securities, but there is a per customer limit of $1.9 million on coverage of cash awaiting investment. This is the maximum excess of SIPC protection currently available in the brokerage industry.

Both SIPC and excess of SIPC coverage is limited to securities held in brokerage positions, including mutual funds if held in your brokerage account and securities held in book entry form.

Investment assets not covered by SIPC

Certain assets are not eligible for SIPC protection. Among the assets typically not eligible for SIPC protection are commodity futures contracts, precious metals, as well as investment contracts (such as limited partnerships), and fixed annuity contracts that are not registered with the U.S. Securities and Exchange Commission under the Securities Act of 1933.

Asset Protection

Schwab is committed to staying financially strong, and we are confident in our ongoing financial health. We run our business with a sound capital structure and position our company for long-term strength and stability. Learn more about the account protections Schwab offers:

Customer Securities

Customer securities—such as stocks and bonds that are fully paid for or excess margin securities—are segregated from broker-dealer securities in compliance with the SEC's Customer Protection Rule. This is a legal requirement for all broker-dealers. In the unlikely event of insolvency of a broker-dealer, these segregated assets are not available to general creditors and are protected against creditors’ claims. There are reporting and auditing requirements in place by government regulators to help ensure all broker-dealers comply with this rule.

SIPC® Account Protection

Protection for securities and cash by the Securities Investor Protection Corporation (SIPC): Accounts of Charles Schwab & Co., Inc. (including those held by clients of investment advisors with Schwab Institutional^®) are insured by SIPC for securities and cash in the event of broker-dealer failure.

SIPC provides up to $500,000 of protection for brokerage accounts held in each separate capacity (e.g., joint tenant or sole owner), with a limit of $250,000 for claims of uninvested cash balances.

Commodity interests and cash in futures accounts are not protected by SIPC. Futures trading involves a high level of risk and is not suitable for all investors. Certain requirements must be met to trade futures. Please read Risk Disclosure Statement for Futures and Options before considering any futures transactions.

More information about SIPC coverage is available at www.sipc.org.

Additional Protection Through Lloyd's of London and Other London Insurers

Additional brokerage insurance—in addition to SIPC protection—is provided to Charles Schwab & Co., Inc. accounts through underwriters in London. Schwab’s coverage with Lloyd's of London and other London insurers, combined with SIPC coverage, provides protection of securities and cash up to an aggregate of $600 million, and is limited to a combined return to any customer from a Trustee, SIPC, and London insurers of $150 million, including cash of up to $1,150,000. This additional protection becomes available in the event that SIPC limits are exhausted.

FDIC Coverage

The FDIC—or Federal Deposit Insurance Corporation—is a U.S. federal agency that protects depositors against the loss of deposit accounts (such as checking and savings) if an FDIC-insured bank fails.

Learn more about FDIC coverage.

LPL Financial is a member firm of the Securities Investor Protection Corporation (SIPC). Membership provides account protection up to a maximum of $500,000 per client, of which $250,000 may be claims for cash. For an explanatory brochure, please visit http://www.sipc.org/. Through London Insurers, LPL Financial accounts have additional securities protection to cover the net equity of client accounts up to an overall aggregate firm limit of $600 million, subject to conditions and limitations.

London Insurers rely on SIPC to determine the extent of losses incurred by individual LPL account holders. This additional protection covers losses above limits available from SIPC and would be payable up to a total of $600 million.

The account protection applies when a SIPC member firm fails financially and is unable to meet its obligations to securities clients, but it does not protect against losses from the rise and fall in the market value of investments. This extensive coverage reflects a strong commitment to serving your investment needs.