Good to know: You do not need to use a claims management company to make your complaint to a financial services company. If a complaint is not successful you can refer it to an Ombudsman service for free. If a financial services company has failed you may be able to refer the claim to the Financial Services Compensation Scheme for free.

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What is the FSCS? How does it operate?

Posted on 28 August, 2021 by Andy Ramsey

What is the FSCS

The Financial Services Compensation Scheme (FSCS) is the UK’s statutory Deposit insurance and investors compensation scheme for customers of authorised financial services firms. This means that FSCS can pay compensation if a firm is unable, or likely to be unable, to pay claims against it.

Set-up by parliament and funded by the financial services industry, FSCS is a completely independent and free service. The FSCS can only pay compensation if the firm responsible was regulated at the time of providing a service or product. Firms authorised by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) pay the FSCS an annual levy which funds the cost of running the service. This allows the FSCS to pay out compensation to eligible claimants. The updated levy for 2021/22 is £833m.

What Firms Are Covered?

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Limits of Cover

There are limits to what you can be awarded depending on the type of claim you wish to make and when the firm failed.

Date Firm FailedPension Provider FailsSIPP Operator FailsBad Pension Advice including pension transfersBad Investment Advice
If the firm failed after 01st Apr 2019

 

100% of your claim, with no upper limitup to £85,000 per eligible person, per firm.up to £85,000 per eligible person, per firm.up to £85,000 per eligible person, per firm.
If it failed between 03 Jul 2015 and 31st Mar 2019100% of your claim, with no upper limit.up to £50,000 per eligible person, per firm.up to £50,000 per eligible person, per firm.up to £50,000 per eligible person, per firm
If it failed between 01st Jan 2010 and  02nd Jul 201590% of your claim, with no upper limitup to £50,000 per eligible person, per firm.up to £50,000 per eligible person, per firm100% of the first £30,000 and 90% of the next £20,000 up to £48,000 per eligible person, per firm

If you have been a victim of bad pension or investment and the firm has failed, we can help you. Call our specialist Pensions team today or complete our easy online questionnaire to see if you are eligible to claim.

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Disclaimer:

Good to know: You do not need to use a claims management company to make your complaint to a financial services company. If a complaint is not successful you can refer it to an Ombudsman service for free. If a financial services company has failed you may be able to refer the claim to the Financial Services Compensation Scheme for free.