With the large number of banks closing around the country, many people are confused and worried about what will happen if their banks fail.

People wonder what the FDIC does, what it protects and how they can make sure their money is safe.

Most banks that operate in the U.S. are insured by the Federal Deposit Insurance Corporation. Most deposits in those institutions are automatically insured up to $250,000 per depositor.

This amount is a temporary increase as of 2008 and will expire on Dec. 31, 2013. The normal insured amount on bank accounts is $100,000. The organization brags on its Web site that since it was created in January 1934, "no depositor has lost a single cent of insured funds as a result of a failure."

The FDIC insures many kinds of accounts, including checking accounts, savings accounts, trusts, money market funs, certificates of deposits and individual retirement accounts. But it does not insure stock market investments, municipal securities, annuities, bonds, life insurance policies or mutual funds.

What Happens?

So, what does all that mean to you and your money?

If your bank fails you will be fully covered up to $250,000 per depositor per bank. In many cases, the failed bank will be reopened by another institution within days of the closure.

"In most cases, the average customer probably wouldn't even know that their bank was closed if an announcement wasn't made," David Barr, spokesman for the FDIC, said in an interview "The bank is usually closed on a Friday and reopens on Monday. We had one last year in rural Ohio that closed on a Thursday and reopened Friday morning as a branch of another institution."

Barr said that if a new owner can't be found quickly, customers could see a disruption. ATM and debit cards would stop working, and checks that hadn't cleared the system will be stamped "bank closed" and returned.

He said that if, for example, a bank fails on Friday and can't reopen by the following Monday, the FDIC will immediately start mailing checks to customers for their insured deposits, along with a final statement so they'll be able to reconcile their checkbooks to see which checks haven't cleared.

"If they have checks that haven't cleared, they'll have to contact those merchants to make other arrangements," he said.