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Savers’ compensation limit set to rise
The deposit protection limit for savings is set to increase from 1 January 2011, the Financial Services Compensation Scheme has announced.
Under the new regulations, the compensation limit for savers who lose money when a bank or building society goes under will rise to the equivalent of the first 100,000 euros (around £84,450).
Currently, individuals are only compensated for the first £50,000 held in an account with a defaulting provider.
It follows new European legislation aimed at ‘harmonising’ the amount of money that is paid out to savers throughout Europe.
The new rules also stipulate that compensation claims should be made within 20 days of an institution being declared in default.
The compensation limit was last raised in 2008 to fully protect the first £50,000 of savings – up from the previous limit of £35,000.