The Financial Services compensation scheme (or FSCS) protects consumers when financial services firms fail.

It is paid for by the financial services industry and it’s the compensation scheme for customers of UK authorised financial services firms.

The FSCS compensate customers if a firm has stopped trading or does not have enough assets to pay claims made against it. This is known as being ‘in default’.

To find out if a firm is already in default, you can visit the FSCS companies in default page.

The FSCS cover business conducted by firms authorised by the Financial Conduct Authority (FCA) such as Teachers Financial Planning and the Prudential Regulation Authority (PRA).

The FCA and the PRA are the UK’s independent financial watchdogs set up by government to regulate UK financial services and protect consumers’ rights. The FSCS can also cover European firms authorised by home state regulators working in the UK.

The products and providers that are recommended by Teachers Financial Planning are all covered by the The FSCS or protected by the European equivalent.

Compensation Limits

The actual level of compensation you receive will depend on the basis of your claim. The FSCS only pays compensation for financial loss. Compensation limits are per person per firm, and per claim category (listed below).

Slightly different limits and rules apply if you have a claim against an insurer or a bank that was insolvent before the FSCS became operational (1 December 2001), or if your claim is against an investment firm that was declared in default before the FSCS became operational.

The maximum levels of compensation are:

Deposits:

£85,000* per person per firm (for claims against firms declared in default from 30 January 2017).

100% of £85,000*.

For more details visit the FSCS Deposit Limits page.

*From 3 July 2015, the FSCS will provide a £1 million protection limit for temporary high balances held with your bank, building society or credit union if it fails. For more information visit the FSCS Q&As about temporary high balances.

Investments:

£50,000 per person per firm (for claims against firms declared in default from 1 January 2010).

100% of the first £50,000.

For more details visit the FSCS Investment Limits page.

Home Finance (e.g. mortgage advice and arranging):

£50,000 per person per firm (for claims against firms declared in default from 1 January 2010).

100% of the first £50,000.

For more details visit the FSCS Home Finance Limits page.

Insurance Business:

There is no upper limit on the amount of protection. (for claims against firms declared in default from 3 July 2015)

Long-term insurance benefits are protected 100%.

Claims under compulsory insurance, professional insurance and certain claims for injury, sickness or infirmity of the policyholder are protected at 100%

Protects 90% of other types of claim with no upper limit.

For more details visit the FSCS Insurance Limits page.

General insurance advice and arranging:

Protects 90% of the claim with no upper limit. Compulsory insurance is 100% (for business conducted on or after 14 January 2005).

For more details visit the FSCS Insurance Limits page.