Financial Dictionary
Securities Investor Protection Corporation (SIPC)
- A government sponsored organization created in 1970 to insure investor accounts at brokerage firms in the event of the brokerage firms' insolvency and liquidation. The maximum insurance of $500,000, including a maximum of $100,000 in cash assets per account, only covers customer losses due to insolvencies, not losses caused by security price fluctuations. SIPC coverage is similar in concept to Federal Deposit Insurance Corporation coverage of customer accounts at commercial banks.
