Frequently Asked Questions about American Share Insurance
The main reason we feel that private insurance is a better fit for our membership is because of the potential increased amount of coverage provided. Unlike federal deposit insurance that insures depositors, ASI insures accounts. Individual members of ASI-insured credit unions can have multiple accounts (savings, checking, money markets, etc.) with each being insured up to $250,000. This will allow many of our members the opportunity to consolidate and insure all of their savings at ACU.
Private share insurance also better complements our state charter. ASI is not a regulator - it functions solely as an insurer of deposits. This relationship permits ACU to operate efficiently within the guidelines of our state regulatory environment.
American Share Insurance (ASI) is a mutual share guaranty corporation authorized to provide share (deposit) insurance.
The company has a national reputation for the quality of its fund and for the institutions it insures. Not every institution applying for coverage is accepted by the fund.
ASI is headquartered in Dublin, OH and has been operating since 1974. The company falls under the regulatory oversight of both the Ohio Department of Commerce and the Ohio Department of Insurance.
ASI is a credit union-owned mutual share guaranty corporation authorized to provide deposit insurance.
Like the Federal Deposit Insurance Corporation (FDIC) fund for banks and the National Credit Union Administration (NCUA) for credit unions, ASI is not a typical property and casualty insurer and, thus, does not have an insurance rating like those provided by Standard and Poor's, Moody's, or AM Best.
Like our credit union, ASI is a strong, financially sound, highly monitored company. As the nation's largest private deposit insurer, ASI is a non-profit corporation owned by the credit unions it insures, and its directors are elected by its member credit unions.
ASI's loss history is also admirable. In the nearly 30-year history of the fund, losses average approximately .01 for every $1,000 of insured shares. No credit union member has EVER lost a cent in an ASI insured account. ASI's outstanding historical performance is illustrated by its exceptionally high ratio of insurance fund equity to member savings, and its track record with respect to minimal insuring losses.
You actually trust your savings to ACU. Established in 1949, ACU is highly regulated and takes limited financial risks. We make careful investments and avoid high risk lending programs to guarantee a healthy balance sheet. As a member, you have a right to feel comfortable with our financial condition and operations.
Remember, your first line of defense against failure is ACU itself.
ASI is the nation's largest private share insurer. It insures only credit unions, and all applying credit unions are required to undergo an examination before being insured. Furthermore, ASI requires that we provide routine financial and operational information, and submit to semi-annual on-site examinations by their staff.
You can obtain more information about ASI by visiting them online or by requesting a brochure from ACU.
Under ASI, each deposit account (or suffix) at ACU is insured up to $250,000. For example, if you have three certificates, a checking and a savings account, and an IRA, you would be insured up to $1,500,000. As additional account suffixes are opened, each would also be insured up to $250,000.
Thus, the total potential for insurance coverage increases as you open new savings accounts, giving you virtually unlimited coverage.
Coverage provided by the NCUA was restricted to $100,000 per member, regardless of the number of accounts the member may have at the credit union. Additional coverage over the federal limit was only possible by restructuring accounts. In comparison, ASI insures accounts, not members, up to $250,000 per account.
Therefore, a member with four separate deposit accounts in ACU would be insured on a dollar-for-dollar basis up to $1 million if each account were insured to its maximum limit.
They're actually the same thing. Generally, credit unions refer to deposits as shares, since credit union members are also owners. Thus, deposit insurance is called share insurance.
There are many members with funds in other institutions (for insurance purposes) that would like to have all of their accounts at ACU. This added coverage allows them to aggregate their funds in ACU with the knowledge that their deposits are now more broadly insured.
As you know, we are owned by our membership. Since ACU has no stockholders, the profits that are acquired through new memberships and additional accounts are reinvested in all of our members via lower loan rates, higher deposit rates, reduced fees, and new services. Therefore, you do benefit from members that bring additional accounts to ACU due to increased insurance coverage.
There is no direct cost to you for coverage from American Share Insurance. ACU's premium expense (what it pays for deposit insurance) is consistent with the cost it currently pays for federal insurance.