> Is $250k a fixed limit for insured deposits? If your company needs more than $250k to meet a month of payroll, is it advised that you have accounts in multiple banks so that you have the necessary liquidity guaranteed as insured deposits? (E.g. if you need a million you'd need 4 different banks, if you need 5 million you need 20 different banks?)
That is an option, yes. You can also automate it through a couple different ways. Some are third party brokers who then deposits it across multiple institutions keeping each balance below $250k, others are banks that have agreements between each other to share deposits such that the deposit at each institution is below the limit.
For an example of the latter, https://www.intrafinetworkdeposits.com/find-intrafi-network-...
> Or can you pay some extra insurance in order to get the required protection without the operational hassle of having to deal with multiple banks?
The above deals with the operational hassle but you can also directly insure deposits.
The most direct way is the Depositors Insurance Fund, which is run out of Massachusetts and has some participating banks.
Incidentally, really large companies like GM or Toyota, fund their payroll through the commercial paper market. As a result they don’t have the large balances you’re imagining sitting around in bank accounts for a monthly withdrawal.
These sorts of notes actually occupy a fun place in the history of the development of currency, but that’s off topic.