UK Financial Services Compensation Scheme guides lower levy in 2023-24

11/24/2022 | 09:28am

(Alliance News) - The Financial Services Compensation Scheme, which safeguards customer bank deposits and other investments in the UK, on Thursday confirmed its current-year forecast for the levy that pays for the scheme and provided an early indication for financial 2024.

FSCS said the total levy on UK financial firms for financial year 2023 will be GBP625 million, unchanged from its previous forecast. No additional levy is expected for the current financial year, it said.

As an early indication of the levy for financial 2024, FSCS forecast it at GBP478 million. It said the levy will be lower due to surpluses that are expected to be carried over from financial 2023. The surpluses are for expected claims relating to self-invested personal pensions, life insurance distribution, and investment intermediation.

The scheme said it expects to pay GBP517 million in compensation in financial 2023 and GBP592 million in financial 2024.

FSCS said it expects compensation to remain relatively high due to a continued trend toward complex claims in the areas of pension advice and general insurance, and a lag between harm occurring and FSCS receiving claims.

By Tom Waite; thomaslwaite@alliancenews.com

Copyright 2021 Alliance News Limited. All Rights Reserved.

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