What is referred to as an Insured Institution?

An Insured Institution refers specifically to any institution that is defined in the Federal Deposit Insurance Act. This act primarily governs the insurance of deposits in banks and savings associations, providing a level of security for depositors in case of institutional failure. This definition is crucial in the context of federal regulations, as it determines which entities can offer insured accounts, thus playing a significant role in the stability and trust of the banking system.

The other choices do not align with the formal definition of an Insured Institution. While a funeral home with insurance may imply some level of financial protection, it does not fit the legal and regulatory framework established by the Federal Deposit Insurance Act. Similarly, a state-affiliated funeral service provider and a credit union serving local businesses pertain to specific types of services or institutions but do not meet the criteria set forth in the aforementioned federal legislation. Understanding the relationship between insured institutions and federal regulations is key for navigating related topics, especially in sectors that involve public trust and financial security.