FDIC insurance coverage is currently $250,000 per depositor, per account type, per financial institution. (The FDIC, not Max, provides this insurance to depositors.)
By default, Max proposes that you direct the first $249,500 of your cash to the bank with the highest rate (so that principal plus accrued interest will keep you below the $250,000 FDIC insurance limit), the next $249,500 to the bank with the next highest rate, and so on (as pictured below.) As rates change, Max helps you direct your banks to send cash between one another so that your deposits continue to earn as much as possible, all while staying within the FDIC limits at each of your banks.
Joint accounts are insured up to $250,000 per depositor, so if you indicate that you have joint accounts, Max will help you direct up to $499,000 to each account.
By spreading funds across 9 online banks, an individual can obtain up to $2.25 million of incremental FDIC coverage, and couples can obtain up to $9 million of coverage via a combination of individual and joint accounts.
Click here to use the FDIC's Electronic Deposit Insurance Estimator (EDIE) calculator to see how much coverage you may be entitled to.