Cap On FSCS Investment Claims Will Rise To £85,000

Share

It has been reported that the Financial Conduct Authority (FCA) has announced that the maximum pay out for Financial Services Compensation Scheme (FSCS) claims will be increased from £50,000 to £85,000 for investment and pension advice.

Currently, the £50,000 limit is the maximum one individual can receive, per firm, for investment provision and intermediation claims. This basically means that if a firm defaults this is the highest amount the individual will receive. This amount will now be increased to £85,000 and this will be applied to all investment advice and not just pension-related investment advice (as had been mooted), as the FCA said it is too hard to differentiate between pension and investment products.

The FCA estimated the changes to the cap would increase the claims on the investment intermediation class by £18.7 million per year, or a total of £74.8 million from 2010 to 2014.

For the life and pensions intermediation class it would increase it by £6 million per year.

The FCA data found there were 3,517 individuals whose claims exceeded the £50,000 cap for investment advice over the period, and 966 for life and pension’s advice.

An FCA spokeswoman confirmed the cap change would not be applied retrospectively.

Share

Other News

Tax Year End Planning Checklist For Individuals – 2023/24 Tax Year

As tax year end approaches, there is still time to make use of your available reliefs and allowances.

This tax year end planning checklist covers the main planning opportunities available to UK resident individuals and will hopefully help to inspire action to reduce tax for the 2023/24 tax year and to plan ahead for 2024/25.

Higher Rate Taxpaying Is A Growing Club

As tax rate band thresholds are changing, understanding the impact on high rate taxpayers and the economy is crucial.

5 Top Tips To Boost Your Pension Savings

It was recently revealed in the media that the amount we need to enjoy a ‘moderate’ retirement has increased by £8,000 per annum, a 38% increase, in just one year.