Protecting Your Assets

Protecting Your Assets

What insurance protection is available for assets held with trust companies– and Hilliard Lyons Trust Company, LLC in particular?

Trust companies are not banks and so FDIC insurance does not apply. Even if a trust company is a wholly owned subsidiary of a bank, FDIC insurance does not cover assets held with a trust company. This is because the assets held in a trust company belong to the client – not the bank. The assets are fully segregated from bank deposits, brokerage and insurance assets. Ownership of assets held by the trust company remains vested in the individuals or entities for whose benefit a trust company is acting as trustee, agent or custodian. The trust company serving as trustee has certain powers with respect to trust assets, but it has no “beneficial” rights to trust assets and therefore trust assets are not at risk for claims by the trust company’s (or bank’s) creditors.

If a bank or trust company goes into receivership, the receiver would seek out a qualified, well-capitalized company to succeed to the fiduciary roles of the failed institution. There would be no loss of assets and therefore insurance of trust company assets is not required or provided by any government agency.

SIPC insurance also does not cover assets held with a trust company as trust companies are not broker dealer organizations.

So what insurance is available for assets held at a trust company?

Typically, a trust company will have private insurance that will protect the company and the client against fraud, embezzlement, and errors and omissions. Hilliard Lyons Trust Company, LLC does carry private insurance for these purposes.

Hilliard Lyons Trust Company, LLC is regulated by the Kentucky Department of Financial Institutions. It exceeds capitalization requirements for a Kentucky chartered trust company and has internal and external audit programs, and extensive internal policies and procedures all aimed at managing assets appropriately for each client.


Hilliard Lyons Trust Company, LLC is insured with private insurance to protect against crime aimed at the company or assets we manage. Should crime be detected, the company and the client would receive appropriate payment from our insurance carrier. Finally, FDIC insurance does NOT apply to any trust company.

Should you have any questions or concerns about assets we manage on your behalf, please don’t hesitate to contact us. If you are interested in more information on the programs that the government has put in place, please review information at For more information about FDIC insurance and assets or institutions covered, please review

Hilliard Lyons Trust Company, LLC serves as trustee and as agent for trustee of numerous types of trusts, including revocable living trusts, charitable remainder trusts, life insurance trusts, total return trusts, marital trusts, and credit shelter trusts.

Hilliard Lyons Trust Company, LLC

500 W. Jefferson St. | Suite 700

Louisville, KY 40202

502.588.8400 | 888.878.7845

312 Walnut St. | Suite 3120

Cincinnati, OH 45202

513.345.5251 | 800.884.1750

110 Main St.

Evansville, IN 47708

812.428.5147 | 888.426.1481

[email protected]

Hilliard Lyons does not offer tax or legal advice. Please consult your tax advisor or attorney before making any decision that may affect your tax or legal situation.

J.J.B. Hilliard, W.L. Lyons, LLC (Hilliard Lyons) and Hilliard Lyons Trust Company, LLC are affiliated companies. Neither Hilliard Lyons nor Hilliard Lyons Trust Company provide individualized tax, accounting or legal advice. This piece is intended for general educational purposes. Please consult your accountant or attorney for personal tax, accounting or legal advice.

© 2018 J.J.B. Hilliard, W.L. Lyons, LLC.

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