Safety of Customer Accounts
First Clearing is a member of the Securities Investor Protection Corpoation (SIPC), a nonprofit, Congressionally chartered membership corporation created in 1970. SIPC protects clients against the custodial risk of a member investment firm becoming insolvent by replacing missing securities and cash up to $500,000, including up to $250,000 in cash, per client in accordance with SIPC rules. (Note that SIPC coverage is not the same as, nor is it a substitute for, FDIC deposit insurance; securities purchased through First Clearing are not FDIC-insured.) For more information about SIPC, please visit sipc.org.
Excess Coverage Maintained by First Clearing
Above and beyond SIPC coverage, First Clearing maintains additional insurance coverage through Lexington Insurance Company, an AIG Company (referred to here as “Lexington”). For clients who have received the full SIPC payout limit, First Clearing’s policy with Lexington provides additional coverage above the SIPC limits for any missing securities and cash in client investment accounts up to a firm aggregate limit of $1 billion (including up to $1.9 million for cash per client). In other words, the aggregated amount of all client losses covered under this policy is subject to a limit of $1 billion with each client covered up to $1.9 million for cash.
About Lexington Insurance Company
Lexington Insurance Company is the leading U.S.-based surplus lines insurer. As of December 1, 2013, Lexington’s financial strength ratings are “A+” from Standard & Poor’s, “A1” from Moody’s and “A” from Fitch Ratings and A.M. Best. For more information about Lexington, please visit lexingtoninsurance.com.
The Limits of SIPC and Lexington's Insurance Coverage
Please note that coverage provided by SIPC and Lexington does not protect against the loss of market value of securities. All coverage is subject to the specific policy terms and conditions.