How can I be sure my account is really insured?
The Securities Investor Protection Corporation (SIPC) website provides a public list of member broker-dealers. You can verify that your broker is a member there.
Additionally, all insurance details are clearly outlined in your customer agreement.
What Happens If a Broker Goes Bankrupt?
1. Recovery of Securities: The SIPC (Securities Investor Protection Corporation) works to recover your stocks and other assets lost due to broker insolvency. In most cases, SIPC coordinates with a new brokerage firm to transfer your securities back into your account.
2. Cash Compensation: If cash held by the broker is lost, SIPC may provide compensation — up to a maximum of $500,000 per account, including up to $250,000 in cash coverage.
Can I recover money lost due to unsuccessful investments?
The SIPC (Securities Investor Protection Corporation) does not cover investment losses or failed investment strategies.
Its primary role is to protect client assets in the event of broker bankruptcy or misconduct.
What happens if my account exceeds $500,000 and the broker goes bankrupt?
If your assets exceed the coverage limit provided by the Securities Investor Protection Corporation (SIPC), the remaining balance may be covered by additional insurance through Lloyd’s of London — offering extended protection beyond the standard SIPC limits.
Which Accounts Are Covered by Insurance?
All of a client’s accounts are insured, provided the total value per client does not exceed $500,000 under SIPC coverage and $30 million under the additional insurance policy.
