Are Robinhood Stocks Insured? Explained
Are Robinhood Stocks Insured?
Are Robinhood stocks insured is a common question for investors who want to know whether their shares, uninvested cash, and other assets are protected if something goes wrong at the broker. This article explains the regulatory protections that apply to securities and cash held at Robinhood, what protections do not apply (for example market losses and most cryptocurrencies), how Robinhood’s supplemental coverage and cash-sweep programs interact with SIPC and FDIC rules, and practical steps you can take to check and increase your coverage.
As of 2026-01-17, according to Robinhood’s Help Center and Robinhood legal disclosures, Robinhood Financial LLC and Robinhood Securities, LLC are SIPC members and employ supplemental insurance and cash-sweep arrangements that affect how customer assets are protected. This article cites statutory SIPC/FDIC limits and summarizes Robinhood’s published protections; readers should verify the current program bank list and any supplemental policy amounts directly in Robinhood’s disclosures.
Short answer (tl;dr)
- Are Robinhood stocks insured? Yes — securities (stocks, ETFs, certain options positions) held at Robinhood are protected by the Securities Investor Protection Corporation (SIPC) if the broker fails and customer assets are missing, subject to SIPC limits (up to $500,000 per customer, including up to $250,000 for cash). Robinhood also maintains supplemental or "excess of SIPC" insurance that can provide additional recovery in some insolvency scenarios.
- Uninvested brokerage cash may receive FDIC pass-through insurance if it is placed in Robinhood’s brokerage cash sweep program and deposited at partner banks; FDIC protection is up to $250,000 per depositor per insured bank, aggregated by ownership category.
- Cryptocurrencies held on Robinhood Crypto are not covered by SIPC or FDIC; Robinhood states certain crime-insurance protections may apply but these are limited and not equivalent to SIPC/FDIC coverage.
Background — key terms and regulators
- SIPC (Securities Investor Protection Corporation): A non-profit created by Congress that protects customers if a SIPC-member broker-dealer fails and customer securities are missing. SIPC protection aims to restore customer securities and cash up to statutory limits, but it does not guard against market losses.
- FDIC (Federal Deposit Insurance Corporation): Federal agency that insures deposits at FDIC-insured banks against bank failure, typically up to $250,000 per depositor, per insured bank, per ownership category.
- SEC (Securities and Exchange Commission): Federal regulator overseeing securities markets and broker-dealer conduct.
- FINRA (Financial Industry Regulatory Authority): Self-regulatory organization that supervises broker-dealers and enforces rules.
- Cash sweep / pass-through FDIC: A brokerage arrangement that deposits uninvested cash across one or more partner banks so that each bank’s FDIC insurance is available on a per-bank basis, potentially increasing aggregate FDIC coverage.
- Supplemental or "excess of SIPC" insurance: Private insurance bought by a brokerage to provide additional recovery beyond SIPC statutory limits in the event SIPC coverage is exhausted; terms and caps vary by broker and insurer.
Why these distinctions matter: SIPC protects against broker insolvency that results in missing assets; FDIC protects bank deposits if a bank fails; neither protects against the normal rise and fall of market prices. Different products (stocks vs crypto vs bank deposits) are governed by different protections.
How brokerage protection works in general
Brokerage protection rests on two separate regimes:
- SIPC protects customer securities and certain cash in a broker-dealer insolvency when assets are missing. SIPC’s goal is to return the actual securities or cash customers are owed, not to compensate for market losses.
- FDIC insures deposits at banks. Brokerages often use “cash sweep” programs that deposit customers’ uninvested cash into partner banks; that deposited cash can then receive FDIC insurance on a per-bank basis.
Important common points: neither SIPC nor FDIC protects against investment losses caused by market movements, poor investment choices, or declining prices. Insurance for crypto and some non-security products is generally separate and limited.
SIPC protection for Robinhood accounts
What SIPC covers
SIPC steps in when a SIPC-member broker-dealer fails and customer securities or cash are missing from customer accounts due to the firm’s financial failure or misappropriation. SIPC’s purpose is to return to customers the securities and cash they are owed, to the extent possible. SIPC does not insure against declines in market value, bad investment results, or fraud unrelated to broker insolvency.
SIPC limits
- SIPC protection is up to $500,000 per customer, including up to $250,000 for cash claims. These limits are statutory and apply per “customer” and per separate capacity (for example individual vs certain retirement accounts), subject to rules on aggregation.
How SIPC claims are handled
In a broker-dealer liquidation, SIPC typically appoints a trustee to recover assets, transfer customer accounts if possible, and distribute missing securities or cash. Customers normally file claims through the trustee; SIPC’s role is to facilitate restoration of customer assets rather than to function as a general insurance payout mechanism.
In practice, if a broker fails but customer securities are intact and segregated, customers may see little or no disruption. SIPC primarily addresses missing or misallocated assets.
Robinhood’s supplemental ("excess of SIPC") insurance
Existence and basic terms
Robinhood states that it purchases supplemental or excess-of-SIPC insurance from private insurers in addition to SIPC coverage. This private insurance is intended to provide additional recovery to customers if SIPC limits are insufficient in a particular insolvency scenario.
Coverage limits and per-customer caps
Robinhood’s official disclosures describe a supplemental program in addition to SIPC, but the precise aggregate limits and per-customer caps can change and are specified in Robinhood’s legal materials and help pages. Readers should consult Robinhood’s current disclosures for the latest figures and per-customer maximums.
What supplemental insurance does and doesn’t cover
Like SIPC, supplemental insurance generally covers the replacement of missing customer securities and certain cash shortfalls stemming from broker insolvency. It does not insure against market losses, declines in value, or investment performance. Supplemental insurance also depends on insurer terms and may have exclusions and limits.
FDIC insurance and Robinhood cash sweep / spending accounts / cash card
Difference between FDIC and SIPC
- FDIC insures bank deposits at FDIC-member banks up to $250,000 per depositor, per insured bank, per ownership category. FDIC covers bank failure; it does not protect against investment losses.
- SIPC protects securities and certain cash at broker-dealers in the event of broker failure and missing assets; it is not a bank deposit insurance program.
Robinhood Brokerage Cash Sweep Program
Robinhood operates a brokerage cash sweep program that, for enrolled brokerage cash balances, deposits uninvested cash into a network of program banks. When funds are deposited at FDIC-insured program banks, FDIC pass-through insurance can apply on a per-bank basis, which can increase aggregate FDIC coverage depending on the number of program banks and account ownership categories.
Mechanics in practice:
- Uninvested brokerage cash that is enrolled in the sweep program is held at participating partner banks.
- FDIC insurance applies at the bank level (typically $250,000 per depositor, per insured bank, per ownership category). By spreading balances across multiple program banks, the total FDIC-insured capacity may increase.
- The exact list of program banks and the mechanics (including whether the brokerage or the customer is the depositor for FDIC aggregation) are detailed by Robinhood in its cash sweep disclosures.
Robinhood Spending Account and Cash Card specifics
Robinhood’s spending account products and cash cards are typically offered in partnership with one or more banks and may be held at a named bank or banks. Cash balances in those specific bank accounts are eligible for FDIC insurance up to $250,000 at each bank, aggregated with other deposits the customer holds at the same bank under FDIC rules. Check Robinhood’s disclosures for the named bank(s) that hold spending-account balances and the FDIC treatment.
How to check whether your cash is enrolled and how to opt in/out
Robinhood customers should review their account settings, cash management disclosures, and periodic statements to confirm whether uninvested cash is actively enrolled in the sweep program, which partner banks receive deposits, and whether they have the option to opt out of sweeping. These details are typically available in the app or via Robinhood’s help-center materials and account agreements.
Cryptocurrency and other non-SIPC/FDIC products
Crypto on Robinhood
Are Robinhood stocks insured? That question focuses on securities; crypto is different. Robinhood Crypto holdings are not protected by SIPC or FDIC because cryptocurrencies are not securities or bank deposits that fall under those regimes. Instead, Robinhood has stated that it maintains certain crime-insurance policies that may cover losses from theft of crypto due to certain security breaches. Those policies differ from SIPC/FDIC protection: they are typically limited, subject to deductibles, and may exclude many types of loss. Customers should review Robinhood Crypto disclosures for details on the scope of any crime insurance.
Other products (futures, derivatives, margin)
Certain products such as futures, derivatives, or margin activity may have different protections, additional risks, and different clearing arrangements. For example, margin balances are unsecured exposures to the broker and can be subject to special treatment in insolvency; option positions and certain cleared derivatives rely on clearinghouses and may have different recovery mechanics. Confirm protections for specific product types in Robinhood’s product documents and risk disclosures.
What is not covered
Key exclusions applicable to Robinhood customers include:
- Market losses: declines in the value of stocks, ETFs, or other securities are not insured by SIPC, FDIC, or supplemental policies.
- Crypto holdings: cryptocurrencies are not covered by SIPC or FDIC; limited crime insurance may apply in some cases.
- Fraud or theft that does not result from broker insolvency: certain forms of fraud or unauthorized trading may be addressed by the broker’s policies or regulatory remedies, but are not automatically covered by SIPC or FDIC.
- Cash not placed into the sweep program or held at an FDIC-insured bank: such cash may not be eligible for FDIC pass-through coverage unless it is actually deposited at an insured bank.
Practical implications for Robinhood customers
Example scenarios
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Broker insolvency with missing securities: If Robinhood (the SIPC-member broker-dealer entity used for securities custody) were to fail and customer securities were missing or misappropriated, SIPC protection (up to its limits) would apply to restore missing securities and cash; Robinhood’s supplemental insurance might provide additional recovery beyond SIPC limits in certain cases.
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Market loss: If the value of a stock you own on Robinhood falls, that loss is not insured. SIPC and FDIC do not make you whole for adverse price movements.
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Crypto theft: If cryptocurrency held on Robinhood is stolen due to a security breach, Robinhood’s crime insurance may provide some recovery, but coverage is limited and not equivalent to SIPC/FDIC protections.
How to verify coverage for your specific account
- Read Robinhood’s “How Your Assets Are Protected” help pages and the legal disclosures for your account type.
- Review the SIPC brochure (available from SIPC) to understand the scope of SIPC protection and statutory limits.
- Check your account settings and recent statements to see if your uninvested cash is enrolled in a sweep program and which program banks are used.
- For spending-account or cash-card balances, review the product’s account agreement to identify the bank that holds deposits and the FDIC treatment.
How to maximize protection
Spreading deposits across ownership categories and banks
- FDIC coverage is calculated per depositor per insured bank and per ownership category (for example individual accounts vs joint accounts vs certain retirement accounts). Using different ownership categories legitimately can increase total FDIC coverage.
- For sweep programs, spreading cash across multiple program banks (as offered by the sweep program) can increase aggregate FDIC pass-through coverage. Confirm whether your brokerage automatically enrolls your cash in the sweep and which banks it uses.
Recordkeeping and reconciliation
- Keep trade confirmations, account statements, and transaction records. In the event of a dispute, trustee liquidation, or claim, these documents will support your ownership claims.
- Regularly reconcile your holdings with statements and the brokerage’s position records.
Other practical tips:
- Consider account diversification across custodians if you hold large balances that could exceed SIPC or FDIC coverage at a single firm or bank.
- For cryptocurrency custody, consider non-custodial options (for users comfortable with self-custody) or use custodians with clear and robust insurance disclosures — Bitget Wallet is an example of a secure wallet option recommended within Bitget’s ecosystem.
Regulatory oversight, history, and controversies
Robinhood’s regulatory status
Robinhood operates regulated broker-dealer entities that are SIPC members and are subject to SEC and FINRA oversight for securities activities. The broker must follow custody, recordkeeping, and regulatory capital rules applicable to broker-dealers.
Past operational incidents and their relevance to insurance
Robinhood has experienced high-profile operational incidents and regulatory actions in the past that underscore the importance of understanding protections for account access, trade execution, and asset custody. These incidents typically concern operational availability or compliance issues, which are distinct from SIPC/FDIC protections for customer assets. Understanding customer protections remains important because operational outages, trading restrictions, or compliance issues can affect the user experience but do not change SIPC or FDIC coverage rules.
Frequently asked questions (FAQ)
Q: Are Robinhood stocks insured against market losses? A: No. Market losses from price declines are not insured by SIPC, FDIC, or Robinhood’s supplemental insurance.
Q: Are my uninvested funds FDIC-insured at Robinhood? A: Uninvested funds that are enrolled in Robinhood’s sweep program and deposited at participating FDIC-insured program banks may receive FDIC pass-through coverage. Spending account or cash-card balances held at a named partner bank are subject to FDIC insurance up to $250,000 at that bank.
Q: Does SIPC insure crypto on Robinhood? A: No. SIPC does not insure cryptocurrencies. Robinhood Crypto holdings are not SIPC or FDIC insured; Robinhood may carry limited crime insurance for crypto theft.
Q: How much does Robinhood’s supplemental insurance cover? A: Robinhood maintains supplemental insurance in addition to SIPC, but amounts and per-customer coverage limits are specified in Robinhood’s disclosures and can change. Check Robinhood’s current legal materials for the latest figures.
Q: Where can I get the SIPC brochure? A: The SIPC brochure is available from SIPC and should be provided in broker disclosures; consult your broker’s account opening materials or SIPC’s materials for details.
How to file a claim or get help
- If you suspect missing assets or broker insolvency, contact Robinhood support through the app or support channels and retain all account records.
- SIPC: In the event of a broker-dealer liquidation, SIPC typically works with a court-appointed trustee. You can contact SIPC to inquire about the process and claims procedures. Keep copies of statements, trade confirmations, and identity verification documents.
- Regulators: For regulatory complaints or inquiries, you may also contact FINRA or the SEC as appropriate.
When filing, be factual, provide supporting documentation, and follow the trustee or SIPC guidance on claim submission.
References and primary documents
Primary sources to consult (no external links provided here):
- Robinhood Help: “How Your Assets Are Protected” and related cash-sweep and account-protection pages (Robinhood Help Center and legal disclosures)
- SIPC official materials and brochure
- FDIC guidance on pass-through insurance and deposit insurance FAQs
- Independent explainers from reputable financial media and industry sources summarizing SIPC vs FDIC distinctions and broker protections (for context)
As of 2026-01-17, according to Robinhood’s Help Center and legal disclosures, Robinhood’s securities accounts are SIPC-member accounts and Robinhood operates cash sweep and supplemental insurance programs described above.
Notes and disclaimers
- Insurance terms, program banks, supplemental insurance policies, and product names can change. Confirm amounts and program participants directly in Robinhood’s current disclosures and in SIPC/FDIC materials.
- This article is informational and not investment advice. It does not substitute for reading broker agreements or consulting legal/regulatory materials for your specific circumstances.
Practical checklist: What to do now
- Review your Robinhood account settings to confirm whether your uninvested cash is enrolled in a sweep program.
- Download and keep recent account statements and trade confirmations.
- Review Robinhood’s asset protection disclosures and the SIPC brochure.
- If you hold significant cash balances, consider FDIC coverage strategies (ownership categories, sweep enrollment) or spreading deposits across custodians.
- For crypto holdings, read the Robinhood Crypto disclosures and consider custody alternatives; Bitget Wallet is a recommended secure wallet solution in the Bitget ecosystem for users seeking robust wallet choices.
Further reading and tools: explore Bitget educational resources and Bitget Wallet for custody options and secure asset management within the Bitget ecosystem. For specific legal questions about SIPC or FDIC treatment of your accounts, consult the respective regulator materials or a qualified advisor.
Notes for editors and updates:
- Periodically verify numeric limits and program bank lists; SIPC statutory limits remain $500,000 per customer (including $250,000 cash), while Robinhood’s supplemental insurance amounts and bank partnerships can change.
- Update crypto-insurance details and underwriter names from Robinhood disclosures as they are published.
