ABOVE the 250k level is what they aren’t LEGALLY required to cover.

Yes that’s just reiterating what I literally said originally.

There aren’t different tiers of FDIC insurance. The banks aren’t choosing to paying for extra coverage. The FDIC is a federal program. Yes the banks pay into it. It’s required by law that they do. But the FDIC decides on it’s own if it will cover more than $250k. And they have, for every bank collapse, no matter the size, at least since the late 90s.