Question

What kinds of situations would require the FDIC to refund or replace the money it protects?

Answer 1

The Federal Deposit Insurance Corporation (FDIC) is an independent government agency created to protect depositors in the event a bank fails and can’t refund their customers’ money. If, for any reason, a bank is unable to reimburse its customers, the FDIC steps in—repaying customer deposits up to certain limits. 

Answer 2

The correct answer is:

The FDIC protects depositors in the event of a bank failure.

Explanation:

A bank failure is the closing of a bank.

A bank is closed when it is unable to meet its obligations to depositors and others.

If a bank is insured by FDIC, any depositors in the bank have their money protected, up to a certain amount.