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4000 - Advisory Opinions

Proper Titling of Payable-on-Death Accounts Under the New Deposit Insurance Regulations


September 12, 1990

Adrienne George, Attorney

I am writing in response to your letter to Claude A. Rollin dated May 10, 1990. In that letter, you refer to section 330.8(a) of the FDIC's new insurance regulations, which requires that, for a payable-on-death account, either the words "payable on death to" or the acronym "POD" or some similar designation appear in the account's title. 55 Fed. Reg. 20125 (1990) (to be codified at 12 C.F.R. § 330.8(a)). You then ask whether this requirement would be satisfied when a financial institution attaches to the signature card a "Pay-on-Death Agreement" form which establishes the payable-on-death nature of the account and specifies the account's beneficiary by name, but where the account title itself does not include the words "payable on death to" or "POD" or any similar designation.

Attaching such a "POD Agreement" to the signature card, where the account title does not contain "POD" or some similar designation, is permissible for non-time deposit accounts which were established before July 29, 1990 and for time deposit accounts until their first maturity date after July 29, 1990. (However, for such a "POD Agreement" to be sufficient, it must both establish the payable-on-death nature of the account and list the account's beneficiaries by name.)

For accounts established after those dates, however, the "POD" (or other similar designation) must appear in the title of the account. For a time deposit account, the "POD" designation must appear both immediately after the deposit's first maturity date after July 29, 1990 and whenever the depositor actively rolls over that deposit. Once the "POD" designation has been made the first time on a time deposit, however, subsequent automatic rollovers will carry the "POD" designation with them, requiring no further action by the depositor.

If the depositor fails to add the "POD" or similar designation to the title of the above-mentioned accounts, his relevant account will not be eligible for the special insurance coverage of section 330.8, but will be insured as if it were the individually-owned account of the depositor.

I hope that this information will be useful to you. If I can be of any further help, I can be reached at (202) 898-3859.

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