Compensation limits for pensions (retirement savings)

The compensation limit which applies to your pension will be dependent on the way your pension has been invested.

  • Deposits: if you choose to deposit your pension funds in a bank, building society or credit union you are protected up to £85,000 per person per firm.

  • Investments: If you choose to place your pension funds directly in investments (other than insurance products), you are protected up to £50,000 per person per firm. This limit will also apply if your claim involves the mis-selling of a pension.

  • Retirement income: If you are already drawing a set retirement income from your pension pot from a life insurance contract, such as an annuity, your income is protected by FSCS to 100% if anything happens to your provider.

  • Pension Life Savings: If you are still building up your pension pot, 100% of your pot will be protected if it's directly managed under a life insurance contract. This would include personal pensions and stakeholder pensions, but not defined-benefit workplace pension schemes, which may be instead covered by the Pension Protection Fund.

  • Investment Life Policy Savings: These are long-term life insurance policies which have a savings element, such as endowment policies or investment bonds. Any investment life policy savings you hold are protected up to 100% with no upper limit.

  • Death or Incapacity: FSCS will pay your claim to 100% if it arises from death or incapacity, if anything happens to your provider.

Jargon Buster

  • Credit union

    a financial co-operative which is owned and controlled by its members.
  • Deposits

    money placed in a bank or similar institution to earn interest or for safe-keeping.
  • Investment

    a financial product in which money can be invested to earn interest or profit (although the value of investments can go down as well as up).