Financial Services Compensation Scheme White Papers

The FSCS is the UK’s statutory compensation scheme of last resort for customers of authorised financial institutions. This paper proposes changes to some of the rules in our Compensation sourcebook that govern the operation of the FSCS. The paper also discusses insurance specific issues. VIEW SUMMARY

It is well recognised that it is disproportionately expensive to bring a low-value compensation claim. The ABI surveyed over 50,000 low value motor accident claims from September 2009 to March 2010, and found that for every pound paid in compensation, 87p was paid in legal costs. VIEW SUMMARY

The FSA proposes to increase the ombudsman service’s award limit from £100,000 to £150,000, effective for any complaint referred to the ombudsman service on or after 1 January 2012. This will prevent a decline in the consumer protection afforded by the award limit in real terms. VIEW SUMMARY

In this consultation response, the consumer publication, Which Magazine responds to the Financial Services Compensation Schemes review of limits from a consumer perspective. In our view the current proposals do not go far enough to provide adequate consumer protection in a number of circumstances. VIEW SUMMARY