The Securities Investor Protection Corporation (SIPC) is a non-profit corporation that provides account protection to customers of registered brokerages. That group of protected brokerages includes Folio, the broker-dealer that provides execution, clearing, custody, and other brokerage-related services for Ellevest Digital and Premium clients, as well as Schwab, the broker-dealer for Ellevest Private Wealth clients.
SIPC insurance doesn’t protect the value of your investments; it protects your ownership of the investments themselves. For example, if you purchase 10 shares of a particular stock for a total price of $100, the SIPC does not guarantee that you will get $100 back (if it were guaranteed with no risk, it wouldn’t be investing) — but it does guarantee that you will still own those 10 shares if the brokerage fails, whatever they’re worth at the time.
If a brokerage fails, SIPC will cover losses up to $500,000 (with a limit of $250,000 for cash losses). If you have multiple accounts, the $500,000 SIPC protection does not apply to each account. For example, if you have a taxable investment account and an IRA, SIPC will provide $500,000 maximum in coverage for both accounts combined.
To learn more about SIPC protection, click here.