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Last updated: July 22, 2026 · By White Metal Resources Editorial
Quick answer: Precious metals depository insurance is a private, all-risk cargo-and-vault policy that a bullion vault buys from a specialty carrier, most often through Lloyd's of London syndicates. It covers physical loss of your IRA silver, gold, platinum, or palladium from named perils such as theft, mysterious disappearance, fire, water, and transit accidents, up to the policy limit stated in the depository's certificate.
It is not government protection. FDIC deposit insurance does not apply to bullion stored in a vault, and SIPC only protects securities held by a failed broker-dealer. Depository coverage is private-market coverage, so the carrier, the limit, and the exclusions vary by vault. Ask for the certificate before you fund the account.
Short on time? The essentials
- Depository insurance is a private, all-risk cargo-and-vault policy underwritten by a specialty carrier, usually through Lloyd's of London syndicates.
- Federal statute at 26 U.S.C. Section 408(m)(3)(B) requires that IRA bullion sit in the physical possession of a bank or an approved non-bank trustee, so the vault choice is a compliance choice, not a preference.
- Coverage typically pays for physical loss from theft, mysterious disappearance, fire, water, and transit accidents, up to the depository's stated policy limit.
- Coverage does not pay for market losses when silver, platinum, or palladium prices fall, and it does not cover any metal that was never IRA-eligible in the first place.
- FDIC deposit insurance is for bank deposits, not vault contents. SIPC only covers securities at a failed broker-dealer. Neither applies to physical IRA metal.
- Segregated storage insures identifiable coins or bars in your name. Commingled storage insures your audited share of a like-for-like pool. Both are covered; only the identification differs.
- You should receive, or be able to request, a certificate of insurance naming the carrier, the policy number, the coverage limit, and the depository as insured party.
- If a claim would exceed the vault's aggregate policy limit, payment can be pro-rated across affected account holders, which is why the limit and the vault's total metal on deposit both matter.
This page explains what actually protects the silver, platinum, or palladium sitting in an IRA-approved vault. Coverage looks like a detail on most sales pages. It is not. Every claim in the sections below traces to statute, an IRS publication, or a federal regulator. If you plan to leave real money in an approved depository, the certificate is one of the four documents you should read before you sign.
What does depository insurance actually cover?
Depository insurance is a private, all-risk cargo-and-vault policy that the vault buys from a specialty carrier. It pays the account for the physical loss of the metal from named perils. It does not pay for a drop in the price of silver, gold, platinum, or palladium, and it does not turn the vault into a government-backed institution.
The federal side of the story is short. Under 26 U.S.C. Section 408(m)(3)(B), IRA bullion must be in the physical possession of a bank or an IRS-approved non-bank trustee (source: Cornell Legal Information Institute, 26 U.S.C. Section 408). The IRS restates the physical-possession rule in its Issue Snapshot (source: IRS, investments in collectibles). The statute puts the metal in a vault. The insurance policy is what the vault operator buys to sit on top of that requirement.
Worth knowing: the vault is the insured party, not you. Your IRA benefits from the policy because the metal is titled to the IRA and stored under contract. If the account never sees the certificate, ask for it. A depository that will not produce a current certificate is one to avoid.
Who underwrites the vault, and why Lloyd’s keeps coming up
Most precious-metals vaults in the United States place their coverage through Lloyd's of London syndicates or a comparable specialty marine and cargo carrier. Lloyd's is a market of syndicates that pool capital to underwrite hard-to-place risks. Bullion vault coverage sits alongside cargo, fine art, jewellers' block, and specie insurance, all of which live in that specialty niche.
Three names show up on most silver, platinum, and palladium IRA setups. Delaware Depository operates a purpose-built precious-metals vault in Wilmington, Delaware. International Depository Services runs vaults in Delaware and Texas. Brink's Global Services provides US precious-metals vaulting from locations including New York, Salt Lake City, and Los Angeles. Each vault sources its own policy, so the carrier, the coverage limit, and the exclusion list can differ.
The right question is not "is the vault insured?" It is "who is the carrier, what is the limit, and what is excluded?" Get that in writing. See where silver IRA metal is stored and how the major depositories compare.
Why FDIC and SIPC do not apply to your IRA metal
Two federal protections often get invoked in retirement conversations. Neither one covers physical bullion in a depository, and reading a sales page that implies otherwise is a warning sign.
FDIC insurance covers deposit accounts at insured banks, up to $250,000 per depositor, per bank, per ownership category. It applies to checking, savings, money market deposit accounts, and certain certificates of deposit. It does not cover the contents of a safe deposit box, and it does not cover coins or bars held in a vault (source: FDIC, Deposit Insurance).
SIPC protection is for cash and securities held at a member broker-dealer that fails. The limit is $500,000 per customer, with a $250,000 sub-limit for cash claims. It does not cover investment losses when a market falls, and it does not cover physical commodities such as gold, silver, platinum, or palladium (source: SIPC, What SIPC Protects).
The takeaway: your IRA metal is protected only by the depository's private policy plus the statutory rules that put the metal in the vault. Any pitch that names FDIC or SIPC in the same breath as physical bullion is either loose language or a sign to slow down.
Which risks are inside a policy, and which are excluded
An all-risk cargo-and-vault policy is written in the negative. It covers physical loss of the metal from any cause not specifically excluded. That framing sounds broad, and it is, but the exclusion list still matters. Ask the depository which of the items below appear in the current wording.
Two audit concepts sit alongside the policy. A physical inventory audit confirms the metal is on hand. A financial audit confirms the vault's books tie to that inventory. Most large depositories publish an annual audit summary or provide one on request. Coverage without regular audit is coverage in name only.
| Risk category | Covered | Not covered |
|---|---|---|
| Theft and burglary | Loss of the metal from the vault by force, stealth, or armed attack. | Loss caused by a disqualified party you authorized to remove metal. |
| Mysterious disappearance | Unaccounted-for shortfall discovered on audit, subject to reporting terms. | Reporting delay past the policy notice window. |
| Fire, smoke, and water | Physical damage from fire, smoke, sprinkler discharge, or flooding of the vault. | Progressive wear or mishandling by a third party outside the vault. |
| Natural disaster | Physical loss from earthquake, windstorm, or lightning at the vault, subject to policy terms. | Pre-existing damage or a defect present before the metal arrived. |
| Transit | Armored transport by the depository or its approved carrier, including in-bound shipments. | Uninsured shipments arranged outside the depository's approved carrier list. |
| Market value | The metal's insured value on the date of loss, up to the policy limit. | Market losses when the price of silver, platinum, or palladium falls. |
| Eligibility | IRA-eligible bullion meeting the statutory fineness rule at Section 408(m)(3). | Numismatic or graded coins never IRA-eligible in the first place. |
| War and nuclear | (none, standard exclusion) | Nuclear incident, war, and civil-war losses, per the standard cargo-policy exclusion. |
Sources: Lloyd's-market cargo-and-specie policy structure; 26 U.S.C. Section 408; depository terms. Not a quote from any specific certificate. Checked June 2026.
A vault that pushes back on producing the current wording is a vault that will push back on a claim. Federal enforcement of the metals markets is active, and a 2020 CFTC order against JPMorgan cited gold, silver, platinum, and palladium futures for a period of at least eight years (source: CFTC release 8260-20). The lesson translates to storage: paperwork is the thing that protects the account.
How to read a depository insurance certificate
The certificate of insurance is the one-page document your custodian, and by extension your IRA, relies on. It names the carrier, the policy, and the coverage limit. Reading it takes ten minutes and saves years of assumption. The steps below apply to any US depository your custodian may name.
- Confirm the depository is the insured party. The certificate should name the depository as the insured, not a third-party broker. Vaults with their own coverage should have their name in the "Insured" field on the certificate.
- Identify the carrier and the syndicate. The document should show the carrier, typically Lloyd's of London syndicates or a comparable specialty marine and cargo insurer. Note the syndicate name and the policy reference number.
- Read the coverage limit and the aggregate. The per-loss limit is what the policy pays per event. The aggregate is what it pays across all covered losses in the policy year. Both numbers matter.
- Check the coverage triggers and exclusions. Look for named perils, and check the exclusion list for war, nuclear, wear, and any product outside the IRA-eligible fineness standard.
- Verify the policy period. The certificate should show a current effective date and expiration date. A stale certificate is not proof of current coverage.
- Save the certificate with the account paperwork. Keep the certificate alongside the custodian agreement and the fee schedule, so a spouse or heir can find all three later.
Picture a saver who moves $75,000 into a silver IRA and asks for the depository certificate before the first purchase. Suppose the vault names Lloyd's syndicates, a per-loss limit of $500 million, and an aggregate of $1 billion in this illustration. Suppose the account's silver, on the day the last piece arrives, has an insured value of $75,000.
- Per-loss room versus this account: $500,000,000 divided by $75,000 equals 6,666 accounts of this size the per-loss limit could pay in full at the same event.
- Aggregate room versus this account: $1,000,000,000 divided by $75,000 equals 13,333 accounts of this size the aggregate limit could pay in full over the policy year.
- Excluded from either payment: any drop in the price of silver, any coin outside the IRA-eligible fineness rule, and any shipment sent by a carrier the depository does not approve.
The figures above are illustrative, not quotes from any depository. They show the structural point: a policy limit is real, and it interacts with the vault's total metal on deposit. Ask for the current certificate and the vault's approximate total value on deposit, and do the same rough division. This is an illustration, not financial advice; consult a licensed advisor for your situation.
The calculator below models how flat annual fees, including the small storage line that helps fund the vault's insurance program, compound against a real account over time. Enter a balance and a fee rate to see the drag.
Precious metals IRA fee-drag calculator
Precious metals IRAs charge mostly flat dollar fees (setup, annual custodian, storage). Flat fees take a much bigger bite out of a small account than a large one. Enter your numbers to see the drag.
Estimate only. Fee amounts vary by provider and are often not published; enter figures you confirm in writing. This tool ignores metal price changes and the dealer spread, which also affect returns. Not financial advice.
Segregated, commingled, and how each interacts with coverage
Depositories offer two storage models, and the certificate covers both. The label changes what the account owns on paper, not whether the metal is insured.
Segregated storage keeps your specific coins or bars physically apart from other holdings. On a claim, the depository can identify the exact pieces tied to your account and pay against those pieces. It costs more per year because the vault uses more space and more tracking.
Commingled storage pools like-for-like metal from many accounts. Your account owns an audited share of the pool, not specific serial numbers. On a claim, the depository pays the account for its audited share of the loss, at the metal's insured value on the date of loss. It costs less because the vault is used more efficiently.
The trade-off: for common bullion such as American Silver Eagles or bars from an approved refiner, commingled storage is close to segregated for insurance purposes. If you plan to distribute specific numbered pieces in kind, segregated adds identification. See segregated vs commingled storage and allocated vs unallocated metals.
What happens if a claim would exceed the depository’s limit
Every policy has a stated per-loss limit and an annual aggregate. Between them, they cap what the carrier will pay. On a typical vault event, the total loss sits well inside those limits and the covered accounts are paid at insured value. Rare events can strain a limit.
When a total loss would exceed the aggregate, payment is pro-rated across affected account holders under the terms of the policy. That is why the vault's total metal on deposit matters as much as the policy limit. A large limit at a very large vault can still leave a smaller share per account than a modest limit at a modest vault.
Two levers cover that risk in practice. One is the vault's own claims history and audit cadence, which shapes both the premium and the aggregate the carrier will write. The other is diversification of custodian relationships across two vaults, which some custodians offer for very large accounts. See silver IRA custodians for how title and instructions work across vaults, and silver IRA fees explained for the trade-off in cost.
When depository insurance is not enough on its own
A balanced look has to name the situations where a paid-up policy still fails to save the account. Insurance protects the physical metal against physical loss. It does not protect the account against decisions that live outside the vault.
- You bought coins that were never IRA-eligible. A premium or numismatic coin outside the Section 408(m)(3) fineness rule is treated by the IRS as a deemed distribution at cost. The vault will still hold what it holds, but the coverage universe is defined by IRA-eligible bullion.
- You held the metal outside the depository. Home storage of IRA silver is treated as a distribution. The U.S. Tax Court applied the physical-possession rule against the taxpayers in McNulty v. Commissioner in 2021. No policy can rescue a home-storage structure. See why home storage is not allowed.
- You need the money within a few years. Silver is volatile short-term, and selling means crossing the dealer spread again. Before age 59.5, the 10% federal additional tax stacks on top under IRC Section 72(t), subject to statutory exceptions.
- Your account is small versus fixed vault fees. Insurance sits inside the storage line. A $10,000 account paying $150 in annual storage is at 1.5% per year before custodian fees and before any spread. Coverage is real, but the drag can still eat the account.
If one of these describes you, slowing down is the sensible call. A certificate on the wall does not fix a mismatched plan. There is no CTA in this section on purpose.
Depository insurance questions, answered
What is precious metals depository insurance?
Precious metals depository insurance is a private, all-risk cargo-and-vault policy that a bullion vault buys from a specialty carrier. It covers physical loss of the metal from named perils such as theft, mysterious disappearance, fire, water, and transit accidents, up to the policy limit named in the certificate. It does not cover market losses.
Is my IRA silver FDIC insured?
No. FDIC insurance covers deposit accounts at insured banks, up to $250,000 per depositor, per bank, per ownership category. It does not cover the contents of a safe deposit box, and it does not cover coins or bars stored in a vault. Physical IRA silver is protected by the depository's private policy, not by the FDIC.
Is my IRA silver SIPC insured?
No. SIPC protects cash and securities held at a member broker-dealer that fails, up to $500,000 per customer with a $250,000 sub-limit for cash claims. It does not cover investment losses when a market falls, and it does not cover physical bullion. Any pitch that names SIPC in the same breath as an IRA silver holding is loose language.
Who underwrites depository policies for IRA metals?
Most policies are placed through Lloyd's of London syndicates or a comparable specialty marine and cargo insurer. Lloyd's syndicates pool capital to underwrite hard-to-place risks such as bullion vault storage, cargo, fine art, jewellers' block, and specie. Each depository sources its own policy, so the carrier, the limit, and the exclusions vary.
What is not covered by a typical vault policy?
Market losses when metal prices fall, product that was never IRA-eligible under Section 408(m)(3), and losses from carriers the depository does not approve. Standard cargo-policy exclusions also cover nuclear incidents, war, and civil war. Read the exclusion list on the current certificate.
How do I confirm the coverage before I fund the account?
Ask your custodian to produce the current certificate of insurance for the depository. The certificate should name the carrier, the syndicate reference, the per-loss limit, the annual aggregate, the effective and expiration dates, and the depository as the insured party. A custodian that will not produce a current certificate is a custodian to avoid.
Does insurance change between segregated and commingled storage?
Coverage applies to both. Segregated storage insures identifiable coins or bars in your account's name. Commingled storage insures your audited share of a like-for-like pool. On a claim, the segregated model can identify specific pieces. The commingled model pays the account for its audited share of the loss at the metal's insured value.
What happens if a covered loss exceeds the depository’s policy limit?
Payment can be pro-rated across affected account holders under the terms of the policy. That is why the vault's total metal on deposit matters as much as the stated policy limit. Very large accounts sometimes diversify across two vaults for that reason. Ask the custodian how the aggregate compares with the vault's total value on deposit.
Sources
- Cornell Legal Information Institute, 26 U.S.C. Section 408 (individual retirement accounts, including the physical-possession rule at 408(m)(3)(B)). Checked June 2026.
- Internal Revenue Service, investments in collectibles in individually directed qualified plan accounts (Issue Snapshot). Checked June 2026.
- Internal Revenue Service, Publication 590-B, Distributions from Individual Retirement Arrangements. Checked June 2026.
- Federal Deposit Insurance Corporation, Deposit Insurance (what FDIC covers and does not cover). Checked June 2026.
- Securities Investor Protection Corporation, What SIPC Protects. Checked June 2026.
- London Bullion Market Association, Good Delivery (refiner standards for IRA-eligible bars). Checked June 2026.
- U.S. Commodity Futures Trading Commission, Release 8260-20 (JPMorgan order covering gold, silver, platinum, and palladium futures). Checked June 2026.
