No, FDIC insurance applies to account owners, not accounts.

Fun fact, if you're married, you can actually turn that into 3 * FDIC insurance limit.

- Account 1: You

- Account 2: Your spouse

- Account 3: Jointly you and your spouse

Even more: single, joint, retirement, revocable and irrevocable trust accounts all fall into different categories and are insured independently for each account owner in each bank (the joint account is 250k for all co-owners): https://www.fdic.gov/resources/deposit-insurance/financial-p...

Or you could hold short-term t-bills for any extra money over the FDIC insurance limit. Then you are good unless the US Gov goes bankrupt, which is a non-zero risk but much lower and different.

Yes, I don’t understand what systemic forces are making this not the standard practice.

SVB and its depositors most likely felt that SVB was too big to fail and that the government would just bail them out

You'd need to split across multiple banks.

This can be done manually, with some logistical challenges.

This can also be done automatically, e.g. via CDARS.