WASHINGTON (11/16/09)--The Credit Union National Association (CUNA)has posted analysis of a recent National Credit Union Administration (NCUA) action that finalized a rule eliminating the concept of "qualifying beneficiaries" for share insurance coverage purposes. Informal and formal revocable trust accounts, which are created by credit union members, are covered under the NCUA’s share insurance. These accounts are controlled by the creating member, and transfer any assets in the account to listed beneficiaries in the event that the accountholder dies. The final rule is very similar to an NCUA interim rule issued in October of 2008 which made coverage rules for revocable trust accounts easier to understand and apply. However, the new final rule does reflect a statutory Standard Maximum Share Insurance Amount increase to $250,000 level, the new $1,250,000 benchmark for revocable trust account coverage, and revised examples. The final rule also adopts the calculation created by the interim final rule to determine revocable trust coverage. Under the rule, owners of trust accounts with as many as five beneficiaries are insured up to $250,000 per beneficiary. For owners with over $1,250,000 in a revocable trust, and more than five beneficiaries of that trust, the trust is insured for the greater of $1,250,000 or the aggregate amount of the beneficiaries’ interests, limited to $250,000 per beneficiary. The NCUA final rules will become effective on Nov. 30. For more detailed analysis of the new rules, use the resource link.