Deposit protection is a guarantee that bank customers will get their money back, up to a fixed limit, if their bank fails. It is another name for deposit insurance, and the term is especially common in the UK and Europe, where such schemes are called deposit guarantee or depositor protection schemes. How these schemes work, who pays for them and their limits are explained in full in the Deposit Insurance entry.
Limits are set per depositor, per bank. In the European Union national schemes must protect at least €100,000, and in the United States the Federal Deposit Insurance Corporation covers $250,000 per depositor, per insured bank, for each ownership category. In the UK the scheme is run by the Financial Services Compensation Scheme (FSCS). Money held with e-money or payment firms is usually not covered by deposit protection; it is safeguarded under separate rules instead.
The main purpose is to stop a bank run, since protected savers have less reason to rush to withdraw. The trade-off is moral hazard: depositors may pay less attention to how safe their bank is.