What happens to a 401k over the SIPC limit if the institution goes under or fraud occurs?

There is undoubtedly a lot of discussion about whether or not we’re in a bubble. Hypothetically, If we were in a bubble, and the bubble popped, and your institution holding your 401k became insolvent (or fraud occurred), do all 401k accounts remain whole?

I’ve briefly read about SIPC limits and additional insurance, but what isn’t clear to me is what exactly happens in this case.

Generally, how safe is a person’s money if their 401k is over $500k and the brokerage goes under or if fraud occurs? Would they be screwed if a major firm fails/fraud occurs? If it’s not covered, is it common to break up a 401k exceeding $500k?