The FSCS is the UK's statutory fund of last resort for customers of financial services firms. This means that FSCS can pay compensation to consumers if a financial services firm is unable, or likely to be unable, to pay claims against it. The FSCS is an independent body, set up under the Financial Services & Markets Act 2000 (FSMA). We do not charge individual consumers for using our service.
The FSCS deals with claims against authorised firms (those regulated by the Financial Conduct Authority or the Prudential Regulation Authority) that are unable, or likely to be unable, to pay claims against them. This will generally be because a firm has stopped trading and has insufficient assets to meet claims, or is in insolvency. We describe this as being in default.
The Financial Ombudsman Service deals with complaints against authorised firms that are still trading.
You can find out whether a firm is authorised by using the FCA's Firm Check Service on its consumer website. You can also find out about the status of a firm by telephoning the FCA's Consumer Helpline on 0800 111 6768. They will be able to tell you if the firm is still authorised to trade, and how to get in touch with it.
You should complain directly to it. If your complaint is not resolved, you should contact the Financial Ombudsman Service.
To qualify for compensation you must be eligible under our rules which are made by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), the independent watchdogs set up by government under FSMA to regulate financial services in the UK and protect the rights of consumers. The rules tell us which types of claim are eligible for compensation, and limit how much compensation we are allowed to pay. Different rules and limits apply to different types of claim.
No. The FSCS is a non-profit, independent organisation set up under FSMA. We do not charge individual consumers for using our service.
The length of time a claim takes to process will depend upon a number of factors, like the type and complexity of a claim, and the level of information we need to gather from other sources. Some of these factors may be entirely outside our control, but we are still able to provide general guidelines for each claim type.
Our rules tell us which types of claim are eligible for compensation and limit how much compensation we are allowed to pay. There are limits to the protection FSCS can provide. (See also Question 5).
To be eligible for compensation you must have lost money because of your dealings with a regulated financial services firm. The FSCS can pay compensation only for financial loss. For example, for investment claims the compensation we pay would try to take account of the financial position you would have been in had you not invested.
The fact that the return on your investment or policy was described as 'guaranteed' does not necessarily mean that we can pay you compensation equal to the return you were promised. The FSCS can pay compensation only for financial loss. For example, for investment claims the aim of compensation is generally to put you back in the position you would have been in had you not invested.
The rules and compensation limits of the pre-existing schemes will apply, although the FSCS will handle the claim. Compensation limits and eligibility rules may differ.
As a fund of last resort, we can only consider claims if they cannot be paid by anyone else. If the firm is no longer trading but still has assets that could meet your claim, we are unlikely to be able to help you. This means that you will need to take your case up with the firm you dealt with.
If you are having problems finding the firm or its owners and wish to pursue your claim, we may be able to provide contact details. Please contact us.
If the firm (or its owners) will not consider your claim, you could take legal advice or contact your local Citizens Advice Bureau for help.
The Financial Ombudsman Service (FOS) may be able to help you make your claim in some circumstances.
Individuals are generally eligible to make all types of claims. However, there are stricter rules governing the types of claims that business, charities etc. can make.
FSCS is responsible for deciding eligibility once an authorised firm has gone into default. We will look at the relevant rules covering the different types of claims (e.g. investments, deposits, insurance) as part of this. Even if a claimant is eligible for compensation, they must also have a protected claim against the firm in default. The requirements for a protected claim are different depending on whether it’s a deposit, investment or insurance claim: click on any of the links to access the rules governing that area.
Most types of claimants are eligible to claim compensation for deposits. But there are some limited exceptions, such as claimants who are authorised financial services firms or public bodies. More information can be found under rule 2.2(4) of the Depositor Protection Rules.
Eligibility for investment claims under the COMP rules is generally more restricted – certain exclusions and exceptions apply. For example, large businesses are typically not able to claim compensation unless they meet any of the exceptions.
Charitable status alone is not a relevant factor in deciding eligibility. FSCS will look at, among other things, the legal set-up of the charity. For example, a charity that is a large company will generally be able to make a deposit claim but not an investment one.