True, come to think of it I know someone who got that. But at least the railroad fund is Federal. The greater the pool supporting the fund, the better off you are. A state pool is smaller than the Federal, and is much more likely to go belly-up. Heck, the entire insurance fund for credit unions in Rhode Island went under one New Year's Day, Rhode Islanders with money in the credit union were wiped out. I'm not making this up-they had no money in their accounts as of Jan 1.
I think years later some settlement was made where they got 90 cents on the dollar, but still. I wonder about the people who were going to send their kid to college on that money or get an operation. They needed it right then, not years later.