Mortgage endowment claims dominate FSCS
The Financial Services Compensation Scheme (FSCS), which provides compensation for customers badly treated by regulated financial services firms, paid out almost £150 million during 2006/07.
The FSCS, which was set up under the Financial Services and Markets Act 2000, protects consumers’ interest in areas such as insurance, investment and mortgage business.
During 2006/07 the number of claims considered by the scheme increased 21%, to 31,260.
Claims resulting from the general insurance sector numbered 16,844 with, compensation payments reaching £66.06 million.
In total consumers received £149.47 million in compensation during the year; of this just over £82 million was paid in respect of endowment, pension review and other investment claims.
The majority of claims (88%) received by FSCS during the year related to mortgage endowments and 85% of new endowment claims were dealt with within six months of receipt.
Forty-five per cent of endowment claims resulted in an offer of compensation and the average compensation paid out to endowment claimants was £1,900.
Category: Insurance News
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