As others have pointed out, free cash balances should be OK. RH should have SPIC (SIPC protects against the loss of cash and securities – such as stocks and bonds – held by a customer at a financially-troubled SIPC-member brokerage firm. The limit of SIPC protection is $500,000, which includes a $250,000 limit for cash.) For amounts above SPIC they may have additional insurance in place

However (you knew that was coming, right?) none of these things, including the FDIC insurance, are instantaneous. But they are much faster, at least for retail, than days gone by. Lehman retail accounts were mostly transferred to solvent brokers within a week. Of course if you need to sell something (or buy to cover) every hour of waiting could be costly.

ref: https://libertystreeteconomics.newyorkfed.org/2019/01/custom...