--- title: "FSCS Compensation Explained | Pensions Advice UK" url: https://pensionsadviceuk.com/fscs-compensation/ description: "What the Financial Services Compensation Scheme (FSCS) protects, how much it pays for bad pension advice, what it doesn’t cover, and how to claim for free." last_updated: 2026-10-23 publisher: "Pensions Advice UK (a trading name of GAP-GNX Ltd)" language: en-GB --- If something goes wrong # FSCS compensation explained The Financial Services Compensation Scheme protects you if an authorised firm goes out of business owing you money. Here is what it covers and how to claim. [Request pension advice](https://pensionsadviceuk.com/qualified-advice-request/) Free to enquire. We are an introducer, not an adviser. Important information - Introductions to FCA-authorised advisers - Free to enquire - We call back within the hour, 9am to 5pm weekdays - Details passed on only with your consent **Quick answer:** The Financial Services Compensation Scheme (FSCS) is the UK’s safety net if an authorised financial firm goes out of business and can’t pay what it owes you. For bad pension advice, it can pay up to £85,000 per person, per firm. It is free to claim, and you don’t need anyone to claim for you. ## What is the FSCS? The FSCS is an independent, free service set up by Parliament. It is paid for by a levy on the financial firms it protects. It steps in only when an FCA- or PRA-authorised firm has failed, meaning it has stopped trading and can’t pay claims against it. Think of it as an insurance policy that the whole financial industry pays into, so customers aren’t left with nothing when a firm collapses. ## How much is protected | What you had | Usual FSCS protection | | --- | --- | | Bad pension or investment advice from a firm that has failed | Up to £85,000 per person, per firm | | A personal pension or annuity with an insurance company that fails | Usually 100%, with no upper limit | | A SIPP whose operator fails | Up to £85,000 per person, per firm | | Savings in a UK bank or building society that fails | Up to £120,000 per person, per bank | Limits for firms that failed from 1 April 2019 (advice and investments) and from 1 December 2025 (savings). Older failures may have lower limits. Source: FSCS. ## What the FSCS doesn’t cover - Investments that simply fall in value. Losses from normal market ups and downs aren’t compensation. - Firms that are still trading. Complain to the firm, then the [Financial Ombudsman Service](https://pensionsadviceuk.com/financial-ombudsman-service/). - Firms that were never authorised. This is a key reason to [check the FCA Register](https://pensionsadviceuk.com/check-an-adviser/) first. - Final salary workplace pensions. If the employer goes bust, the Pension Protection Fund may pay compensation instead. ## How to claim 1. **Check the firm has been declared in default.** The FSCS lists the firms it is dealing with. In many cases it will contact customers itself. 2. **Claim directly with the FSCS.** It is free. Have your paperwork ready, such as letters, statements and any recommendation reports. 3. **The FSCS assesses your claim.** If it agrees you lost out, it pays compensation up to the limit. **£0**What it costs you to claim from the FSCS. Claims management companies may charge a share of your compensation for something you can do yourself. ## Frequently asked questions ### Is my pension protected by the FSCS? It depends on the type of pension and who failed. Most personal pensions with insurers are protected at 100%. Bad advice is protected up to £85,000 per person, per firm. Final salary workplace schemes are covered by the Pension Protection Fund instead. ### Is my State Pension protected? The State Pension is paid by the government, so it isn’t affected by a financial firm failing. ### Do I need a claims company? No. Claiming directly from the FSCS is free, and it will help you through the process. ### What if the firm hasn’t gone out of business? Then the FSCS can’t help. Complain to the firm first, and then to the Financial Ombudsman Service if you aren’t happy with its answer. ### Does the £85,000 limit apply per pension? No. It applies per person, per failed firm. If you had claims against two separate failed firms, each would have its own limit. ## Related guides - [What is the FCA, and why does it matter to you?](https://pensionsadviceuk.com/what-is-the-fca/) - [The Financial Ombudsman Service explained](https://pensionsadviceuk.com/financial-ombudsman-service/) - [Check a firm or adviser on the FCA Register](https://pensionsadviceuk.com/check-an-adviser/) - [How to spot a pension scam](https://pensionsadviceuk.com/pension-scams/) ## Going to the official FSCS website You can check whether your firm has failed and start a claim on the FSCS website, or call it free on 0800 678 1100. [Go to the FSCS website](https://www.fscs.org.uk/) Opens the official website in a new tab. This page stays open. ### Important information Pensions Advice UK is a trading name of GAP-GNX Ltd. We are not authorised by the Financial Conduct Authority and we do not provide financial, investment, pension or tax advice. We act solely as an introducer. The information on this page is general information only. It is not a personal recommendation and should not be relied upon when making decisions about your pension. Whether any course of action is right for you depends on your individual circumstances. When you make an enquiry, we may introduce you to an FCA-authorised financial adviser. Any advice, recommendation or regulated service will be provided by that authorised firm, not by Pensions Advice UK. The authorised firm will explain its services and any fees to you directly before you decide to proceed. FCA-authorised firms may have their own criteria for accepting clients, over which we have no control. The value of pensions and investments can fall as well as rise, and you may get back less than you put in. Past performance is not a guide to future returns. Transferring or combining pensions is not right for everyone and may mean giving up valuable benefits or guarantees. Free and impartial guidance about your pension options is available from the government’s MoneyHelper service, and if you are aged 50 or over from Pension Wise, at moneyhelper.org.uk. Compensation limits are those published by the Financial Services Compensation Scheme as at October 2026 and can change. ## Want advice from a protected firm? We introduce you to FCA-authorised advisers, so FSCS protection applies to their advice. Request pension advice 020 3778 0939 We’re an introducer, not an adviser. ## Want to speak to an adviser? Start online, or call us. We call back within the hour between 9am and 5pm on weekdays, or the next working day. [Request pension advice](https://pensionsadviceuk.com/qualified-advice-request/) [020 3778 0939](tel:+442037780939) [Call us](tel:+442037780939) [Enquire](https://pensionsadviceuk.com/qualified-advice-request/) --- Pensions Advice UK (a trading name of GAP-GNX Ltd) connects UK residents with FCA-authorised pension advisers and pension tracing services. It is not FCA-authorised and does not give financial or tax advice. It acts solely as an introducer to FCA-authorised firms, who provide any advice and explain any fees before you proceed. This is the text version of https://pensionsadviceuk.com/fscs-compensation/. More pages: https://pensionsadviceuk.com/llms.txt