Abstract: The deposit insurance legal system can act as an important part of the modern financial safety net. Since the birth of this system, it has been developing rapidly all over the world. Now it is internationally recognized to regard the deposit insurance legal system, the function of the central bank’s lender of last resort and the financial prudential supervision system as the three pillars maintaining financial stability, together establishing a “safety net” for banking system. The deposit insurance legal system has great value in maintaining the security and stability of the financial sector, protecting the interests of depositors, and promoting fair competition in the banking sector. The establishment of China’s deposit insurance legal system is not only an inevitable choice for the development of China’s market economy, but also an important system for the market-oriented structure reform of China’s banking industry.

Key words: finance; deposit insurance; legal system