What is covered by the FSCS?
FSCS protects your deposits, whether you’re an individual or a company. A deposit is money in accounts such as current and savings accounts, including cash ISAs. If your bank, building society or credit union fails, we may be able to pay compensation.
What is the purpose of the FSCS?
FSCS protects you when financial firms fail If the financial firm you’ve used has gone out of business and can’t pay your claim, we can step in to pay compensation.
What is the Financial Services Compensation Scheme in UK?
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.
How does the financial services compensation scheme work?
The Financial Services Compensation Scheme (FSCS) protects customers from losing some of their cash if authorised financial services firms go bust. It protects up to £85,000 of savings per individual, per financial institution (not just per bank), and also covers mortgages, insurance and investments.
How much does the financial compensation scheme cover?
When a bank, building society or credit union goes out of business, the Financial Services Compensation Scheme (FSCS) will automatically pay out depositors with eligible deposits up to £85,000. Customers of other types of financial services may have to contact the FSCS directly.
How long does it take for FSCS to pay out?
We’re responding to these as quickly as possible, and working to reduce the amount of time each one takes to resolve….How long will my claim take?
| Claim type | 8 out of 10 customers get their decision within |
|---|---|
| Pensions | 11 months* |
| PPI | 2 months |
| Whole of life insurance | 6 months |
What is considered a lot of money?
Compared to 2021 standards, respondents to the 2020 survey described the threshold for wealth as being a net worth of $2.6 million.
What is the Financial Services compensation scheme (FCS)?
The Financial Services Compensation Scheme was introduced under the Financial Services and Markets Act 2000 to protect the customers of financial services firms that go out of business. This means that if your bank, building society or credit union goes bust, the FSCS will step in to pay compensation.
Who is covered by the FSCS?
Any firm that is authorised by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) is covered by the FSCS. The scheme was set up under the Financial Services and Markets Act 2000 and became active on 1 December 2001.
How long does it take to get compensation from the FSCS?
For general insurance claims, the FSCS aims to pay out within 14 working days of agreement of the claim, and for payment protection insurance (PPI), you can expect to receive your compensation within three months. For other financial services products, the FSCS says it aims to resolve claims within six months.
What is the maximum FSCS payout for depositors?
Before 2007, the maximum FSCS pay-out for depositors was just £31,700 per person, made up of 100% of the first £2,000 and then 90% of their next £33,000. Temporary high balance protection was introduced in 2015 and provides cover of up to £1million per person, per banking licence for a period of no more than 6 months.