FCA Handbook - COMP 10.2 Limits on compensation payable

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COMP 10.2 Limits on compensation payable

The limits on the maximum compensation sums payable by the FSCS for protected claims are set out in COMP 10.2.3 R.

The limits apply to the aggregate amount of claims in respect of each category of protected claim that an eligible claimant has against the relevant person (or, where applicable, a successor). Consequently, a claimant who has, for example, a claim against a relevant person (or, where applicable, a successor) in connection with protected investment business of £70,000, and a further such claim of £20,000, will only receive the £85,000 limit.

Table Limits

This table belongs to COMP 10.2.1R

Type of claim	Level of cover	Maximum payment




Protected investment business (except where the designated investment is a long-term care insurance contract that is a pure protection contract)	100% of claim	£85,000
Protected investment business where the designated investment is a long-term care insurance contract that is a pure protection contract	100% of claim	Unlimited
Protected home finance mediation	100% of claim	£85,000
Protected non-investment insurance distribution	(1) where the claim is in respect of a liability subject to compulsory insurance: 100% of claim	Unlimited
	(2) where the claim is in respect of: (a) a relevant omission; and (b) a professional indemnity insurance contract, or would be in respect of a professional indemnity insurance contract, if the insurance contract had been effected: 100% of claim	Unlimited
	(3) where the claim is: (a) in respect of a relevant omission; (b) in respect of a relevant general insurance contract or would be in respect of a relevant general insurance contract if the insurance contract had been effected; and (c) arises from the death or incapacity of the policyholder owing to injury, sickness or infirmity: 100% of claim	Unlimited
	(4) where the claim is in respect of: (a) a relevant omission; and (b) a pure protection contract, or would be in respect of a pure protection contract if the insurance contract had been effected: 100% of claim	Unlimited
	(5) In all other cases: 90% of claim	Unlimited
Protected debt management business	100% of claim	£85,000
Protected funeral plan business	100% of claim	£85,000

COMP 12 sets out the rules the FSCS will follow when calculating the amount of compensation payable.

COMP 12.4.4R includes further limits relating to certain claims against pre-IP completion day incoming EEA firms, where the act or omission giving rise to the claim arose before IP completion day. These reflect the Investor Compensation Directive, which will continue to apply to EEA State compensation schemes after IP completion day, under which compensation may be payable by the pre-IP completion day incoming EEA firm’s EEA State compensation scheme.

Claims in cases where there is a successor

No claimant shall be eligible to make a claim under the compensation scheme in respect of both the relevant person and a successor arising from the same act or omission by the relevant person.

Claims arising under COMP 3.2.4 R

If a firm has a claim under COMP 3.2.4 R, the FSCS must treat the share of the shortfall of each customer as if it were a protected claim for the purposes of calculating the limits of compensation payable, within COMP 10.2, in relation to that customer.

Claims in cases where a principal and its appointed representative are both in default

No claimant shall be eligible to make a claim under the compensation scheme in respect of both a principal and its appointed representative arising from the same act or omission by the appointed representative.