What is an FSCS protected pension?

What is an FSCS protected pension?

Since the pension freedoms legislation was introduced in the UK in 2015, people have enjoyed much greater levels of control over their retirement savings.

This particular bill has opened up a range of different saving and pension withdrawal options, enabling better monetary flexibility for individuals everywhere.

It has also served to somewhat complicate matters, especially when it comes to protecting your money in the event that your financial services product or firm goes bankrupt.

Thankfully, this is where the FSCS (Financial Services Compensation Scheme) may be able to help. Security and safety are paramount in any form of investment, particularly when it comes to incredibly important financial decision-making, such as where to invest your pension. Read on to find the answer to, ‘what is an FSCS protected pension?’

What is the FSCS?

The FSCS is a scheme designed to protect investors in the event that an authorised financial services firm goes out of business or if they receive bad investment advice from an independent financial advisor.

They cover a wide range of investment types, including pensions. In many cases, pension holders are covered up to £85,000 by the FSCS, but this figure could increase in certain circumstances.

Losing your pension to bad financial advice can be heartbreaking, but it’s imperative that you contact the FSCS if this has happened to you – they might be able to compensate you substantially.

FCA authorised

The only way the FSCS will be able to compensate you is if your financial service or product is authorised by the FCA (the Financial Conduct Authority), and you can check to see if this is the case on their website.

You can also look for a firm reference number (supplied to them by the FCA) on the documents your pension provider gave you, or you could ask them directly.

If your pension is authorised by the FCA, then you have an FSCS protected pension. Before you commit to any type of financial product, it’s crucial that you check to see if they’re authorised.

If your firm failed

If your pension firm went bankrupt after April 2019, the FSCS can pay you 100% of your claim, and there’s no upper limit to what you can get back.

However, the £85,000 limit stands if it was the fault of your SIPP (self-invested personal pension) operator or if you received poor financial advice.

There is a useful tool on the FSCS website to help you find out whether or not you’re eligible for compensation, so don’t hesitate to check it out if you need additional support.

If you have an occupational pension scheme that failed, the FSCS won’t be able to compensate you. However, the PPF (Pension Protection Fund) might be able to recover your money – this could help you protect your savings in the event that your defined benefit pension scheme fails.

iSIPP is FSCS protected

At iSIPP, we take the safety and security of our customer’s money extremely seriously. Our customers always come first, which is why we put transparency and communication at the forefront of our processes.

We are fully authorised by the FCA, and we’re FSCS protected. Our expert financial advisors will always help you make the financial decisions that best suit your preferences as an investor and your needs in retirement.

We believe that safety and security empower our customers to find their financial confidence, so we offer you the space, the tools, and the advice to create the ideal environment for you. With us, you never have to worry ‘is my pension protected?’

If you have any questions at all about our services, how they’re protected and how we can look after your pension, reach out to our friendly team today here – we’re here to help you secure your financial future.




The content of this article is for general information purposes only and should not be construed as legal, financial or taxation advice. You should not rely on the information contained in this article as legal, financial or taxation advice. The content of this article is based on information currently available to us, and the current laws in force in the UK. The content does not take account of individual circumstances and may not reflect recent changes in the law since the date it was created. It is essential that detailed financial and tax advice should be sought in both jurisdictions and any legal advice, if required.

This notice cannot disclose all the risks associated with the products we make available to you. When making your own investment decisions it is important you understand that all investments can fall as well as rise in value and it is possible you may get back less than what you have paid in. You should also be satisfied that any investments you choose are suitable for you in the light of your circumstances and financial position. You should seek financial advice if you are not sure of what’s best for your situation.

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