LONDON, Nov 9 (Reuters) – Britain’s Financial Services Compensation Scheme (FSCS) has forecast imposing a levy of 415 million pounds ($510 million) against UK financial firms to fund 2024/25 claims for redress from customers suffering poor advice and insurance provider failures.
This indicative figure is higher than for 2023/24, primarily due to larger surpluses that were carried over from the 2022/23 financial year which reduced the 2023/24 levy to 270 million pounds, the FSCS said.
The levy is likely to include cover on self-invested personal pension (SIPP) operator failure claims and pay-outs for insurance firm failures that occurred in previous financial years, it added.
“FSCS directly contributes to trust and stability in our financial services system and makes a genuine difference to consumers’ lives,” Martyn Beauchamp, Interim Chief Executive of FSCS said in a statement.
“From a claims perspective, we are seeing recent trends continuing. Most of our compensation continues to be paid out for poor financial advice and for legacy insurance provider failures – both of which include some of the most complex defaults and claims we handle,” he added.
The FSCS said it did not expect to raise any additional levies in 2023/24.
($1 = 0.8142 pounds)
Reporting By Sinead Cruise; editing by Simon Jessop
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