Investor Protection

The main points are:

The Financial Services Compensation Scheme (FSCS) can pay compensation only when an authorised firm is unable, or likely to be unable, to pay claims made against it.  They describe this as being in default.
 
The FSCS only pay compensation for financial loss.  The Scheme was set up mainly to assist private individuals, although smaller businesses are also covered.  Larger businesses are generally excluded, although there are some exceptions to this for deposit and insurance claims.

The maximum levels of compensation are: 

• Deposits: £50,000 per person.
• Investments: £50,000 per person.
• Long-term insurance (e.g. life assurance, critical illness and income protection) – 90% of the claim, with no upper limit.

There is no Irish based compensation scheme, but if a policyholder was UK habitually resident at the time they took out a policy with an Irish life insurer, they would be covered under the FSCS.

For more information about FSCS go to www.fscs.org.uk.