Financial Services Compensation Scheme:

This scheme pays compensation if your financial service provider is held to be “in default”. Going into default would mean that the company had gone into liquidation and ceased trading. The provider must have been regulated by the Financial Service Authority (FSA). The first step will be to check that the provider of the financial services was regulated by the FSA. You can check on the FSA website in the firms search section, which will provide details as to whether that firm is regulated.

There are limits as to the amounts of compensation which will be payable by the FSCS.


Currently the limit is £85,000 per person per authorised firm, if the firm is declared in default after 31st December 2010. This covers money in current accounts, savings accounts.

Investment Business:

The fund can pay compensation to consumers as a consequence of poor or misleading advice, negligent management of investment, misrepresentation or fraud and the firm has gone out of business. The current limits are £50,000 per person, per firm if the date of default is after 31st January 2010.

Home Finances and Mortgages:

Compensation can be given if the firm gives you advice about your mortgage which was not suitable and you have lost money as a consequence and the firm has gone out of business. The current limit is £50,000 pounds, per claim after the 31st January 2010.


If you were sold an insurance policy, then the current limit is 90%, with no upper limit. It is important to check there is no overlap between brands. The compensation limit per firm applies to a firm sometimes a firm has more than one brand.

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