Paul, if a depositor has more than $100,000 there are many ways to be insured at one bank. Most people have at least a couple of family members they can list as beneficiaries. $100,000 is just for a single account owner. Go to the FDIC website for information on revocable trust accounts. All you need to do is ask the bank rep to put Payable on Death on a CD or other
account. Each trust account is insured up to an additional $100,000 per qualified beneficiary. (i.e., spouse, child, sister, brother)

You can also go to a CDARS partner. http://www.cdars.com There are about 2,000 banks that belong to CDARS and unless you have more than $50 million, you just get one statement, one interest rate and each account is FDIC insured up to $100,000.

I don’t understand why other states don’t carry SIF or DIF like the banks in MA. They are insurance funds that cover all amounts above the FDIC limit. See http://www.coopcentralbank.com and http://www.difxs.com

“COUNTRYWIDE had 94,000 foreclosures last year. By comparison, ING has had just 15 out of 100,000 in its eight-year history as a mortgage lender. So what’s the online bank’s secret? Unlike other lenders, who have sliced, diced, and sold off their loans to Wall Street, ING has kept all $26 billion of its loans on its books … [Says Arkadi Kuhlmann, CEO of ING Direct, many banks resell] their mortgages, and with no skin in the game, underwriting standards suffer.” (Jon Birger, Fortune, 3/17/2008, “ING dodges subprime: only 15 foreclosures for the bank since 2000.”)

If a bank “improves” its bottom line on paper by lumping its loans, good and bad, into one jumbo security and then selling that security to some Wall Street firm, then it’ll probably look better — and its numbers will crunch better — to outside entities like Bankrate, whose formulas many not take into account the funny numbers. I’d have to know more about how Bankrate crunches its numbers to be sure, but I suspect this is the case.

Frankly, I’m quite happy to keep my hard-earned money in a bank in which the CEO is actually keeping an eye on underwriting standards, regardless of its Bankrate star ratings. Bankrate’s ratings can be useful, but take them with a grain of salt — and never, never exceed FDIC insurance limits on any bank accounts anywhere.

also, I don’t know if the $100k FDIC is getting adjusted for inflation. $100k is way less purchasing power than even 10 years ago, especially in the context of the housing bubble. It could get tedious for people to have 1/2 dozen bank accounts, along with a myriad of brokers, and other money oriented accounts.