American Share Insurance (ASI) and Excess Share Insurance (ESI) are pleased to release a new study by Glenn Grossman, Professor of Finance and Entrepreneurship at Grace College. The report examines the evolution of deposit insurance in the United States and explores whether a system created during the Great Depression remains the best fit for today's financial marketplace.

The study also highlights that private deposit insurance is a proven and longstanding alternative to the federal model. Available to state-chartered credit unions in ten states, private insurance has existed for more than 50 years. Since 1974, ASI has continuously protected member deposits, demonstrating the durability and effectiveness of a private, market-based approach to deposit insurance. The report comes as policymakers and industry stakeholders continue to evaluate the future of deposit insurance following the 2023 bank failures, growth in uninsured deposits, and renewed discussions around expanding federal coverage.

The study further highlights ASI's model as an example of how disciplined underwriting, independent oversight, and strong capital standards can support a resilient deposit insurance framework. The report notes that privately insured credit unions maintain strong capital positions and operate under a dual oversight structure that includes both state regulatory supervision and independent monitoring by ASI.

"The risk profile of depository institutions today differs from that of a century ago. Moreover, the capacity to offer private deposit insurance that effectively addresses known risks and supports financial stability now far surpasses that of earlier private insurance programs," says Grossman.

The report concludes that private deposit insurance should be recognized as a viable and proven component of the nation's deposit insurance system. By providing states and credit unions with an additional option, private insurance promotes choice, innovation, and financial accountability while maintaining confidence in insured deposits. Private deposit insurance is not a retreat from safety but a modern, market-based approach to protecting consumers and strengthening financial stability.