Regulatory changes in recent years have allowed FDIC-insured institutions to offer stocks, bonds, mutual funds, annuities, life insurance and other products not traditionally sold by banks. These products can be attractive alternatives to bank deposits because they often provide a higher rate of return. Unlike deposits, however, these other products are not FDIC-insured and, in some cases, could lose value.

"These new products can offer the potential for higher returns than traditional deposits, but consumers need to understand these products, especially the risks, before they make a purchase," says Kate Spears, an FDIC consumer affairs specialist.

Federal law is specific about what is covered by FDIC insurance if an insured banking institution were to fail. Coverage includes checking accounts, savings accounts and certificates of deposit (CDs). What's not insured by the FDIC includes stocks, bonds, mutual funds and annuities.

To minimize potential confusion, banks and savings institutions are required to clearly differentiate FDIC-insured deposits from uninsured investments, both in sales practices and advertisements. For example, when offering or advertising an investment product, FDIC-insured institutions must indicate that the investment is not FDIC-insured, is not guaranteed by the bank or savings institution, and is subject to investment risk, including the possible loss of principal.