COMP INTRO
Introduction
COMP INTRO 1
Foreword
- 01/12/2004
The Act requires the FSA to make rules establishing a scheme for compensating consumers when authorised firms are unable, or likely to be unable, to satisfy claims against them. The body established to operate and administer the compensation scheme is the Financial Services Compensation Scheme Limited (FSCS). By making rules that allow the FSCS to pay compensation to retail consumers and small businesses, focusing protection on those who need it most, the compensation scheme rules form an important part of the toolkit the FSA will use to meet its statutory objectives.
This module of the FSA Handbook contains the rules and guidance that allow the Financial Services Compensation Scheme Limited to pay claims for compensation or secure continuity of insurance when an authorised person is unable or likely to be unable to meet claims against it. The rules specify who is eligible to receive compensation and in what circumstances, how much compensation can be paid to a claimant; and how the scheme will be funded. The compensation rules are of interest to consumers. The rules apply to the FSCS and to authorised firms.
- 01/12/2004
The Sourcebook is divided into 14 Chapters covering all aspects of the scheme:
Chapter 1: Introduction and Overview
This chapter provides an introduction to the FSCS rules and a table of question and answers that may be of interest to consumers.
- 01/12/2004
Chapter 2: The FSCS
This chapter gives the FSCS the duty to administer the compensation scheme. It also sets out the general conditions the FSCS must follow when administering the scheme such as having regard to the efficient and economic use of resources, the requirement to publish an Annual Report, and the duty to ensure consumers are informed about how they can make a claim. The rules in this chapter also require the FSCS to have in place procedures for dealing with complaints.
- 01/12/2004
Chapter 3 The qualifying conditions for paying compensation
This chapter sets out the main qualifying conditions that must be satisfied before the FSCS can pay compensation to claimants or take steps to secure continuity of insurance. These are that a claimant is eligible to claim; the activity that gave rise to the loss is protected by the scheme; the firm against which the claim is being made is protected by the scheme; and that the claimant has assigned his rights to the scheme. Chapters 4-7 expand on the general conditions described in Chapter 3.
- 01/12/2004
Chapter 4 Eligible claimants
This chapter specifies who is eligible to receive compensation or benefit from the continuity of insurance provided by the FSCS.
- 01/12/2004
Chapter 5 What is a protected claim?This chapter specifies the activities that are protected by the FSCS.
- 01/12/2004
Chapter 6 Relevant persons in default
This chapter specifies the circumstances when a firm is in default, that is, when a firm is to be taken as being unable or likely to be unable to meet claims against it. The FSCS can only pay compensation, take steps to secure continuity of insurance, or provide assistance to an insurer in financial difficulties if the circumstances specified in Chapter 6 are met
- 01/12/2004
Chapter 7 Assignment of rights
This chapter enables the FSCS to make an offer of compensation conditional on the claimant assigning to it their rights to claim against the failed firm. If the FSCS recovers from the firm a greater sum than it has paid to the claimant, it must pay the balance to the claimant.
- 01/12/2004
Chapter 8 Rejection of application and withdrawal of offer
This chapter allows the FCSS to reject an application for compensation or withdraw an offer of compensation in specified circumstances.
- 01/12/2004
Chapter 9 Time limits on payment and postponing payment
This chapter requires the FSCS to pay a claim for compensation within a specified time unless specified conditions apply.
- 01/12/2004
Chapter 10 Limits on the amount of compensation payable
This chapter specifies the maximum amount of compensation the FSCS can pay to a claimant, and the limits on the FSCS's duty to secure continuity of insurance for policyholders. Different limits apply depending on whether a claim is for a deposit, a claim on an insurance policy, or a claim in connection with an investment.
- 01/12/2004
Chapter 11 Payment of compensation
This chapter specifies to whom the FSCS may pay compensation. In certain circumstances compensation may be paid to a person other than the claimant.
- 01/12/2004
Chapter 12 Calculating compensation
This chapter specifies how the FSCS will calculate the amount of compensation it can pay to a claimant
- 01/12/2004
Chapter 13 Funding
Chapter 13 relating to the funding of the FSCS has now been deleted. The funding provisions for the FSCS are now contained in FEES 6 instead and allow the FSCS to make levies on authorised firms to fund the operation of the scheme, to pay compensation or secure continuity of insurance. FEES 6 specifies how FSCS can make levies, how costs are to be allocated, the maximum the FSCS can levy in any particular period of time, and how sums recovered from failed firms are to be treated.
Chapter 14 Participation by EEA firms
This chapter sets out the way the FSCS deals with incoming EEA firms who may choose to top-up into the FSCS to supplement the compensation available from their home state scheme.
- 01/12/2004
COMP 1
Introduction and Overview
COMP 1.1
Application, Introduction, and Purpose
- 01/12/2004
Application
COMP 1.1.1
See Notes
COMP 1.1.2
See Notes
COMP 1.1.3
See Notes
Introduction
COMP 1.1.5
See Notes
COMP 1.1.6
See Notes
Purpose
COMP 1.1.7
See Notes
COMP 1.1.8
See Notes
COMP 1.1.9
See Notes
COMP 1.1.10
See Notes
- 01/12/2001
COMP 1.2
The FSCS
- 01/12/2004
COMP 1.2.1
See Notes
COMP 1.2.2
See Notes
- 01/12/2001
COMP 1.3
Claimants
- 01/12/2004
COMP 1.3.1
See Notes
COMP 1.3.2
See Notes
COMP 1.3.3
See Notes
Areas of particular interest to claimants (see COMP 1.1.3G).
This Table belongs to COMP 1.3.3 COMP 1.1.3 G .
Q1 | What do I need to do in order to receive compensation? | ||
A1 | In order to receive compensation: | ||
(1) | you must be an eligible claimant; | COMP 4.2 | |
(2) | you must have a protected claim; | COMP 5.2 | |
(3) | you must be claiming against a relevant person; | COMP 6.2.1 R | |
(4) | the relevant person must be in default. | COMP 6.3 | |
In addition, if the FSCS requires you to do so, you must assign your legal rights in the claim to the FSCS. | COMP 7.2 | ||
And you must bring your claim to the FSCS within a set time (normally within six years of the date on which your claim against the relevant person occurred). | COMP 8.2.3 R - COMP 8.2.5 R | ||
It is possible, in certain circumstances, for someone else to make a claim on your behalf. | COMP 3.2.2 R | ||
Q2 | How much compensation will I be offered? | ||
A2 | This depends on whether your protected claim is: | ||
(1) | a claim for a protected deposit; or | COMP 5.3 | |
(2) | a claim under a protected contract of insurance; or | COMP 5.4 | |
(3) | a claim in connection with protected investment business; or | COMP 5.5 | |
(4) | a claim in connection with protected mortgage business; or | COMP 5.6 | |
(5) | a claim in connection with protected non-investment insurance mediation. | COMP 5.7 | |
Different limits apply to different types of claim. | COMP 10.2.3 R | ||
Q3 | How will the FSCS calculate the compensation that is offered to me? | ||
A3 | Again, this will depend on whether your protected claim is a: | ||
(1) | a claim for a protected deposit; | COMP 12.2.1 R, COMP 12.3.1 R and COMP 12.4.1 R | |
(2) | a claim under a protected contract of insurance; | COMP 12.2.1 R, COMP 12.3.2 R and COMP 12.4.9 R | |
(3) | a claim in connection with protected investment business; or | COMP 12.2.1 R, COMP 12.3.5 R and COMP 12.4.2 R | |
(4) | a claim in connection with protected mortgage business. | COMP 12.4.17 R | |
(5) | a claim in connection with protected non-investment insurance mediation. | COMP 12.4.20 R | |
Certain types of protected investment business claim require the FSCS to use a particular method of calculation. | COMP 12.4.5 R | ||
Q4 | What happens if an insurance undertaking is insolvent? | ||
A4 | If you have a long-term insurance contract which is not a reinsurance contract with an insolvent insurance undertaking, the FSCS will first try to secure continuity of insurance for you. | COMP 3.3, COMP 11.2.3 R and COMP 12.4.11 R | |
If the FSCS achieves this, you will not necessarily receive any cash, but you will continue to be insured (though possibly with lower benefits than before). | COMP 3.3 and COMP 11.2.3 R. | ||
You will receive cash compensation only if the FSCS cannot secure continuity of insurance cover or the cost of doing so would be unreasonable. | COMP 3.3.1 R and COMP 11.2.1 R | ||
If you have a relevant general insurance contract which is not a reinsurance contract with an insolvent insurance undertaking, the FSCS will pay you cash compensation if it is unable to secure continuity of insurance cover or the cost of doing so would be unreasonable. | COMP 3.2.1 R and COMP 11.2.3 R | ||
If the insurance undertaking is in "financial difficulties", the FSCS may try to arrange for another insurance undertaking to take over the business, or provide the insurance undertaking with financial assistance to carry on business. If this occurs, you will not receive cash compensation, but your policy will continue (though possibly with lower benefits than before). | COMP 3.3.3 R and COMP 11.2.3 R |
COMP 1.4
EEA Firms
- 01/12/2004
COMP 1.4.1
See Notes
COMP 1.4.2
See Notes
COMP 1.4.3
See Notes
COMP 1.5
Application to Lloyd's
- 01/12/2004
COMP 1.5.1
See Notes
COMP 1.5.2
See Notes
COMP 1.5.3
See Notes
Compensation arrangements for policyholders
COMP 1.5.4
See Notes
COMP 1.5.5
See Notes
COMP 1.5.6
See Notes
Compensation arrangements for individual members
COMP 1.5.7
See Notes
COMP 1.5.8
See Notes
COMP 1.5.9
See Notes
COMP 1.5.10
See Notes
COMP 1.5.11
See Notes
COMP 1.5.12
See Notes
Export chapter as
COMP 2
The FSCS
COMP 2.1
Application and Purpose
- 01/12/2004
Application
COMP 2.1.1
See Notes
Purpose
COMP 2.1.2
See Notes
COMP 2.2
Duties of the FSCS
- 01/12/2004
Administering the compensation scheme
COMP 2.2.1
See Notes
COMP 2.2.2
See Notes
Information for claimants
COMP 2.2.3
See Notes
Assistance to claimants
COMP 2.2.4
See Notes
Annual Report
COMP 2.2.5
See Notes
Finance and resources
COMP 2.2.6
See Notes
Publication of defaults
COMP 2.2.7
See Notes
Complaints
COMP 2.2.8
See Notes
COMP 3
The qualifying conditions for compensation
COMP 3.1
Application and Purpose
- 01/12/2004
Application
COMP 3.1.1
See Notes
COMP 3.1.2
See Notes
Purpose
COMP 3.1.3
See Notes
COMP 3.1.4
See Notes
COMP 3.2
The qualifying conditions for paying compensation
- 01/12/2004
COMP 3.2.1
See Notes
COMP 3.2.2
See Notes
COMP 3.2.3
See Notes
COMP 3.2.4
See Notes
- 14/01/2005
COMP 3.3
Insurance
- 01/12/2004
Securing continuity of long term insurance cover
COMP 3.3.1
See Notes
COMP 3.3.2
See Notes
COMP 3.3.2A
See Notes
COMP 3.3.2B
See Notes
COMP 3.3.2C
See Notes
COMP 3.3.2D
See Notes
COMP 3.3.2E
See Notes
COMP 3.3.2F
See Notes
Insurance undertakings in financial difficulties
COMP 3.3.3
See Notes
COMP 3.3.4
See Notes
COMP 3.3.4A
See Notes
COMP 3.3.5
See Notes
- 01/12/2003
COMP 3.3.6
See Notes
Assessing the costs of paying compensation
COMP 3.3.7
See Notes
COMP 4
Eligible claimants
COMP 4.1
Application and Purpose
- 01/12/2004
Application
COMP 4.1.1
See Notes
COMP 4.1.2
See Notes
Purpose
COMP 4.1.3
See Notes
COMP 4.2
Who is eligible to benefit from the protection provided by the FSCS?
- 01/12/2004
COMP 4.2.1
See Notes
COMP 4.2.2
See Notes
Table COMP 4.2.2R Persons not eligible to claim unless COMP 4.3 applies (see COMP 4.2.1R)
This table belongs to COMP 4.2.1R
(1) | Firms (other than a sole trader firm ,; a credit union , a trustee of a stakeholder pension scheme (which is not an occupational pension scheme) or a small business whose claim arises out of a regulated activity for which they do not have a permission) | ||
(2) | Overseas financial services institutions | ||
(3) | Collective investment schemes, and anyone who is the operator or trustee of such a scheme | ||
(4) | Pension and retirement funds, and anyone who is a trustee of such a fund. However, this exclusion does not apply to: | ||
(a) | a trustee of a personal pension scheme or a stakeholder pension scheme (which is not an occupational pension scheme ); or | ||
(b) | a trustee of a small self-administered scheme or an occupational pension scheme of an employer which is not a large company , large partnership or large mutual association . | ||
(5) | Supranational institutions, governments, and central administrative authorities | ||
(6) | Provincial, regional, local and municipal authorities | ||
(7) | Directors and managers of the relevant person in default. However, this exclusion does not apply if: | ||
(a) | both of the following apply: | ||
(i) | the relevant person in default is a mutual association which is not a large mutual association; and | ||
(ii) | the directors and managers do not receive a salary or other remuneration for services performed by them for the relevant person in default, or | ||
(b) | the relevant person in default is a credit union. | ||
(8) | Close relatives of persons excluded by (7) above | ||
(9) | Bodies corporate in the same group as the relevant person in default except bodies corporate which fall within COMP 4.2.2 R (4)(a) or (b). | ||
(10) | Persons holding 5% or more of the capital of the relevant person in default, or of any body corporate in the samegroup | ||
(11) | The auditors of the relevant person in default, or of anybody corporate in the samegroup as therelevant person in default, or any actuary appointed under SUP 4 (Actuaries) by a friendly society or insurance undertaking in default | ||
(12) | Persons who, in the opinion of the FSCS, are responsible for, or have contributed to, the relevant person'sdefault | ||
(13) | Large companies or large mutual associations | ||
(14) | Large partnerships | ||
(15) | Persons whose claim arises from transactions in connection with which they have been convicted of an offence of money laundering. | ||
(16) | Persons whose claim arises under the Third Parties (Rights against Insurers) Act 1930 | ||
(17) | Where the claim is in relation to a protected contract of insurance or protected non-investment insurance mediation, body corporate, partnerships, mutual associations and unincorporated associations which are not small businesses. |
COMP 4.2.3
See Notes
COMP 4.3
Exceptions: Circumstances where a person coming within COMP 4.2.2R may receive compensation
- 01/12/2004
Deposits
COMP 4.3.1
See Notes
Long term insurance
COMP 4.3.2
See Notes
Relevant general insurance contracts
COMP 4.3.3
See Notes
COMP 4.3.4
See Notes
COMP 4.3.5
See Notes
Liability subject to compulsory insurance
COMP 4.3.6
See Notes
Protected investment business and protected mortgage business
COMP 4.3.7
See Notes
COMP 4.4
Exceptions: Relevant general insurance contracts: mesothelioma claims
- 22/12/2006
Application
COMP 4.4.1
See Notes
Claims for contribution by responsible persons
COMP 4.4.2
See Notes
COMP 4.4.3
See Notes
COMP 4.4.4
See Notes
Limits to amounts payable for contribution claims
COMP 4.4.5
See Notes
COMP 5
Protected claims
COMP 5.1
Application and Purpose
- 01/12/2004
Application
COMP 5.1.1
See Notes
COMP 5.1.2
See Notes
Purpose
COMP 5.1.3
See Notes
COMP 5.2
What is a protected claim?
- 01/12/2004
COMP 5.2.1
See Notes
COMP 5.2.2
See Notes
- 13/02/2004
COMP 5.3
Protected deposits
- 01/12/2004
- Future version of COMP 5.3 after 06/08/2009
COMP 5.3.1
See Notes
COMP 5.4
Protected contracts of insurance
- 01/12/2004
COMP 5.4.1
See Notes
Contracts of insurance issued after commencement
COMP 5.4.2
See Notes
COMP 5.4.3
See Notes
COMP 5.4.4
See Notes
Contracts of insurance issued before commencement
COMP 5.4.5
See Notes
Contracts not evidenced by a policy
COMP 5.4.6
See Notes
Liabilities giving rise to claims under a protected contract of insurance
COMP 5.4.7
See Notes
COMP 5.5
Protected investment business
- 01/12/2004
COMP 5.5.1
See Notes
COMP 5.5.2
See Notes
COMP 5.6
Protected mortgage business
- 01/12/2004
- Future version of COMP 5.6 after 06/04/2007
COMP 5.6.1
See Notes
COMP 5.6.2
See Notes
COMP 5.7
Protected non-investment insurance mediation
- 01/12/2004
COMP 5.7.1
See Notes
- 18/11/2005
- Past version of COMP 5.7.1 before 18/11/2005
COMP 5.7.2
See Notes
- 18/11/2005
- Past version of COMP 5.7.2 before 18/11/2005
COMP 5.7.3
See Notes
- 18/11/2005
COMP 5.7.4
See Notes
- 18/11/2005
COMP 6
Relevant persons in default
COMP 6.1
Application and Purpose
- 01/12/2004
Application
COMP 6.1.1
See Notes
COMP 6.1.2
See Notes
Purpose
COMP 6.1.3
See Notes
COMP 6.1.4
See Notes
COMP 6.2
Who is a relevant person?
- 01/12/2004
COMP 6.2.1
See Notes
COMP 6.2.2
See Notes
COMP 6.3
When is a relevant person in default?
- 01/12/2004
COMP 6.3.1
See Notes
COMP 6.3.2
See Notes
COMP 6.3.3
See Notes
COMP 6.3.4
See Notes
COMP 6.3.5
See Notes
Members in default and the Central Fund of the Society
COMP 6.3.6
See Notes
COMP 6.3.7
See Notes
Claims arising under COMP 3.2.4 R
COMP 6.3.8
See Notes
- 14/01/2005
Export chapter as
COMP 7
Assignment of rights
COMP 7.1
Application
- 01/12/2004
Application and Purpose
COMP 7.1.1
See Notes
COMP 7.1.2
See Notes
Purpose
COMP 7.1.3
See Notes
COMP 7.2
How does the assignment of rights work?
- 01/12/2004
COMP 7.2.1
See Notes
COMP 7.2.2
See Notes
COMP 7.2.3
See Notes
COMP 7.2.4
See Notes
COMP 7.2.4A
See Notes
COMP 7.2.5
See Notes
COMP 7.2.6
See Notes
COMP 7.2.7
See Notes
- 14/01/2005
COMP 8
Rejection of application and withdrawal of offer
COMP 8.1
Application and Purpose
- 01/12/2004
Application
COMP 8.1.1
See Notes
COMP 8.1.2
See Notes
Purpose
COMP 8.1.3
See Notes
COMP 8.2
Rejection of application for compensation
- 01/12/2004
COMP 8.2.1
See Notes
COMP 8.2.2
See Notes
COMP 8.2.3
See Notes
COMP 8.2.4
See Notes
COMP 8.2.5
See Notes
- 01/08/2003
COMP 8.2.6
See Notes
- 01/08/2003
COMP 8.2.7
See Notes
- 01/07/2004
COMP 8.2.8
See Notes
- 01/07/2004
COMP 8.3
Withdrawal of offer of compensation
- 01/12/2004
COMP 8.3.1
See Notes
COMP 8.3.2
See Notes
COMP 8.3.3
See Notes
COMP 8.3.4
See Notes
COMP 8.3.5
See Notes
COMP 9
Time limits on payment and postponing payment
COMP 9.1
Application and Purpose
- 01/12/2004
Application
COMP 9.1.1
See Notes
COMP 9.1.2
See Notes
Purpose
COMP 9.1.3
See Notes
COMP 9.2
When must compensation be paid?
- 01/12/2004
COMP 9.2.1
See Notes
COMP 9.2.2
See Notes
COMP 9.2.3
See Notes
COMP 10
Limits on the amount of compensation payable
COMP 10.1
Application and Purpose
- 01/12/2004
Application
COMP 10.1.1
See Notes
COMP 10.1.2
See Notes
Purpose
COMP 10.1.3
See Notes
COMP 10.1.4
See Notes
COMP 10.2
Limits on compensation payable
- 01/12/2004
COMP 10.2.1
See Notes
COMP 10.2.2
See Notes
COMP 10.2.3
See Notes
Table Limits
This table belongs to COMP 10.2.1R
Type of claim | Level of cover | Maximum payment |
Protected deposit | 100% x first £2,000 90% x next £33,000 | £31,700 |
Protected contract of insurance when the contract is a relevant general insurance contract | (1) Where the claim is in respect of a liability subject to compulsory insurance : 100% of claim | Unlimited |
(2) Where the claim arises under the Third Party (Rights against Insurers) Act 1930, is in respect of a liability within COMP 5.4.5R(1)(b), and is in connection with an Article 9 default: 90% of the . claim | Unlimited | |
(3) In all other cases:
100% x first £2,000 90% of remainder of the claim. | Unlimited | |
Protected contract of insurance when the contract is a long-term insurance contract | 100% x first £2,000 At least 90% of the remaining value of the policy as determined in accordance with COMP 12. | Unlimited |
Protected investment business | 100% x first £30,000 90% x next £20,000 | £48,000 |
Protected mortgage business |
100% x first £30,000
90% x next £20,000 | £48,000 |
Protected non-investment insurance mediation | (1) where the claim is in respect of a liability subject to compulsory insurance : 100% of claim | Unlimited |
(2) In all other cases: 100% x first £2000 90% of the remainder of the claim | Unlimited |
COMP 10.2.4
See Notes
COMP 10.2.5
See Notes
Continuity of insurance cover
Claims against more than one member in respect of a single protected contract of insurance to be treated as a single claim
COMP 10.2.8
See Notes
Claims arising under COMP 3.2.4 R
COMP 10.2.9
See Notes
- 14/01/2005
COMP 11
Payment of compensation
COMP 11.1
Application and Purpose
- 01/12/2004
Application
COMP 11.1.1
See Notes
COMP 11.1.2
See Notes
Purpose
COMP 11.1.3
See Notes
COMP 11.2
Payment
- 01/12/2004
To whom must payment be made?
COMP 11.2.1
See Notes
COMP 11.2.2
See Notes
COMP 11.2.3
See Notes
Reduced or interim payments
COMP 11.2.4
See Notes
COMP 11.2.5
See Notes
COMP 11.2.6
See Notes
COMP 11.2.6A
See Notes
Paying interest on compensation
COMP 11.2.7
See Notes
COMP 11.2.8
See Notes
Export chapter as
COMP 12
Calculating compensation
COMP 12.1
Application and Purpose
- 01/12/2004
Application
COMP 12.1.1
See Notes
COMP 12.1.2
See Notes
Purpose
COMP 12.1.3
See Notes
COMP 12.2
Quantification: general
- 01/12/2004
COMP 12.2.1
See Notes
COMP 12.2.2
See Notes
COMP 12.2.3
See Notes
Overall net claim
COMP 12.2.4
See Notes
COMP 12.2.5
See Notes
COMP 12.2.6
See Notes
COMP 12.2.7
See Notes
COMP 12.2.8
See Notes
COMP 12.2.9
See Notes
COMP 12.3
Quantification date
- 01/12/2004
Protected deposits
COMP 12.3.1
See Notes
Protected contracts of insurance
COMP 12.3.2
See Notes
COMP 12.3.3
See Notes
COMP 12.3.4
See Notes
Protected investment business
COMP 12.3.5
See Notes
- 01/12/2001
COMP 12.3.6
See Notes
- 01/12/2001
Protected mortgage business
COMP 12.3.7
See Notes
Protected non-investment insurance mediation
COMP 12.3.8
See Notes
- 01/12/2001
COMP 12.4
The compensation calculation
- 01/12/2004
Protected deposit with incoming EEA firm
COMP 12.4.1
See Notes
Protected investment business: general
COMP 12.4.2
See Notes
- 01/12/2001
COMP 12.4.3
See Notes
- 01/12/2001
COMP 12.4.4
See Notes
Protected investment business: claims covered by the pensions review
COMP 12.4.5
See Notes
- 01/12/2001
COMP 12.4.6
See Notes
- 01/12/2001
Protected investment business: FSAVC Review
COMP 12.4.7
See Notes
- 01/12/2001
Protected investment business: excessive benefits
COMP 12.4.8
See Notes
- 01/12/2001
Protected contracts of insurance: liabilities subject to compulsory insurance
COMP 12.4.9
See Notes
Protected contracts of insurance: general insurance
COMP 12.4.10
See Notes
Protected contracts of insurance: long-term insurance
COMP 12.4.11
See Notes
COMP 12.4.11A
See Notes
COMP 12.4.12
See Notes
COMP 12.4.13
See Notes
COMP 12.4.14
See Notes
COMP 12.4.15
See Notes
Protected non-investment insurance mediation
COMP 12.4.16
See Notes
Protected mortgage business
COMP 12.4.17
See Notes
COMP 12.4.18
See Notes
COMP 12.4.19
See Notes
Protected non-investment insurance mediation
COMP 12.4.20
See Notes
- 01/12/2001
COMP 12.4.21
See Notes
- 01/12/2001
COMP 12.6
Quantification: trustees, personal representatives, agents, and joint claims
- 01/12/2004
- Future version of COMP 12.6 after 06/04/2007
Trustees
COMP 12.6.1
See Notes
COMP 12.6.2
See Notes
COMP 12.6.2A
See Notes
COMP 12.6.3
See Notes
COMP 12.6.4
See Notes
COMP 12.6.5
See Notes
COMP 12.6.6
See Notes
COMP 12.6.7
See Notes
Personal representative
COMP 12.6.8
See Notes
Agents
COMP 12.6.9
See Notes
Joint claims
COMP 12.6.10
See Notes
Foreign law
COMP 12.6.11
See Notes
Claims arising under COMP 3.2.4 R
COMP 12.6.12
See Notes
- 14/01/2005
Export chapter as
COMP 13
Funding
COMP 13.1
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.1 before 01/01/2006
COMP 13.2
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.2 before 01/01/2006
COMP 13.3
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.3 before 01/01/2006
COMP 13.4
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.4 before 01/01/2006
COMP 13.5
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.5 before 01/01/2006
COMP 13.6
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.6 before 01/01/2006
COMP 13.6A
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.6A before 01/01/2006
COMP 13.7
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.7 before 01/01/2006
COMP 13.8
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
- 01/01/2006
- Past version of COMP 13.8 before 01/01/2006
COMP 13 Ann 1
[deleted: the provisions in relation to the funding of the Financial Services Compensation Scheme are set out in FEES 6 (Financial Services Compensation Scheme Funding)]
COMP 14
Participation by EEA Firms
COMP 14.1
Application and Purpose
- 01/12/2004
Application
COMP 14.1.1
See Notes
COMP 14.1.2
See Notes
Purpose
COMP 14.1.3
See Notes
COMP 14.1.4
See Notes
COMP 14.1.5
See Notes
COMP 14.1.6
See Notes
COMP 14.2
Obtaining top-up cover
- 01/12/2004
COMP 14.2.1
See Notes
COMP 14.2.2
See Notes
COMP 14.2.3
See Notes
COMP 14.2.4
See Notes
COMP 14.2.5
See Notes
COMP 14.3
Co-operation between the FSCS and Home State compensation schemes
- 01/12/2004
COMP 14.3.1
See Notes
COMP 14.4
Ending top-up cover
- 01/12/2004
FSCS terminating top-up cover
COMP 14.4.1
See Notes
COMP 14.4.2
See Notes
COMP 14.4.3
See Notes
COMP 14.4.4
See Notes
Resignation of an EEA firm from the compensation scheme
COMP 14.4.5
See Notes
Notice to customers and the FSCS
COMP 14.4.6
See Notes
COMP 14.4.7
See Notes
COMP 14.4.8
See Notes
Export chapter as
Transitional Provisions and Schedules
COMP TP 1
Transitional Provisions
Transitional Provisions Table
(1) | (2) | (3) | (4) | (5) | (6) | ||
Material to which the transitional provision applies | Transitional Provision | Transitional provision: dates in force | Handbook Provisions coming into force | ||||
1 | COMP 5 | R | Protected claims | Indefinitely | Commencement | ||
(1) | A claim for a protected deposit or under a protected contract of insurance includes a claim in respect of an article 9 default, subject to (2) | ||||||
(2) | A claim must be treated as a claim in relation to a protected contract of insurance under COMP 5.4.5 R if the conditions in article 9A or 10(1)(a)-(d) of the compensation transitionals order are satisfied. | Commencement but on 6 December 2006 for article 9A of the compensation transitionals order | |||||
(3) | A claim in connection with protected investment business includes a claim in respect of a pending application. | ||||||
(4) | Where the claim is in respect of an article 9 default or a pending application, theFSCSmust apply the rules of therelevant former scheme, as they applied to the default beforecommencement, unless (2) applies. | ||||||
(5) | The rules of each investment business compensation scheme are amended so that references to the person managing the scheme are replaced by references to the FSCS. | ||||||
(6) | The rules of the Friendly Societies Protection Scheme are amended so that: | ||||||
(a) | references to the person managing the scheme are replaced by references to the FSCS; and | ||||||
(b) | References to functions conferred upon the Friendly Societies Protection Scheme Board are replaced by references to functions conferred upon the FSCS. | ||||||
(7) | Where the default occurs after commencement, aclaimfor aprotected depositincludes aclaimthat arose beforecommencementin respect of: | ||||||
(a) | a deposit within the meaning of the Banking Act 1987; and | ||||||
(b) | a claim in respect of a protected investment within the meaning of section 27 of the Building Societies Act 1986. | ||||||
(8) | Where the default occurs after commencement, aclaim in connection withprotected investment businessincludes aclaimthat could have been entertained under aninvestment business compensation scheme(provided that the person making the claim has not also made apending applicationarising out of the same set of facts). | ||||||
2 | COMP 13.5 and COMP 13.6 | R | Expired | ||||
3 | COMP 13.4.6 R and COMP 13.6.7 R | R | Expired | ||||
4 | COMP 13.5.8 R | R | Expired | ||||
5 | COMP 6.2.1 R | R | Credit unions | Indefinitely | Commencement | ||
In relation to a claim or potential claim referred to in (1) or (2), a relevant person is also any credit union which: | |||||||
(1) | becomes unable, or is likely to become unable, to satisfy claims against it which relate to deposits which were accepted before 2 July 2002; or | ||||||
(2) | (a) | has ceased to have Part IV permission by virtue of article 3(4) of the Financial Services and Markets Act 2000 (Permission and Applications) (Credit Unions etc.) Order 2002 (SI 2002/704) (failure to comply with a direction to re-apply for Part IV permission); and | |||||
(b) | thereafter, becomes unable, or is likely to become unable, to satisfy claims against it which relate to deposits which were accepted on or after 2 July 2002 but before the date on which it ceased to have Part IV permission. | ||||||
6 | COMP 6.2.1 R | G | In consequence of transitional provision 5R, compensation can be provided: | ||||
(a) | in respect of a credit union which is unable, or likely to become unable, to satisfy claims for protected deposits accepted before 2 July 2002; and | ||||||
(b) | where a credit union has ceased to hold a Part IV permission (because of failure to comply with a direction to re-apply for the Part IV permission), for protected deposits accepted on or after 2 July 2002 but before the date at which it ceased to have the Part IV permission. | ||||||
7 | COMP 6.2.1 R | G | In consequence of transitional provision 5R(1), a credit union becomes a relevant person in respect of deposits accepted before 2 July 2002. | ||||
8 | Amendments introduced by the Compensation Sourcebook (Amendment No.2) Instrument 2003. | R | Provisions and definitions arising out of (2) only apply to defaults, or circumstances giving rise to arrangements made under COMP 3.3.1 R or to measures taken under COMP or to measures taken under COMP 3.3.3 R, occurring after the date in (6) | Indefinitely | 1 December 2003 | ||
9 | COMP 13.6.8 R | R | Expired | ||||
10 | COMP 5.7.1 R, COMP 13.4.7 R and COMP 13.6.9 R | R | Rules not in effect. | 31 October 2004 to 13 January 2005 | 31 October 2004 | ||
11 | FEES 6.3.1 R, FEES 6.3.22 R, FEES 6.4.8 R, FEES 6.4.6 R, FEES 6.5.1 R and FEES 6.5.6 R | R | With regard to contribution group A.18 Mortgage lenders, advisers and arrangers, the management expenses levy and compensation costs levy for 2005/2006 may also take account of expenditure in the period 31 October 2004 to 31 March 2005. | 31 October 2004 to 31 March 2006 | 31 October 2004 | ||
12 | FEES 6.5.7R (4), FEES 6.3.22 R, FEES 6.4.6 R, FEES 6.4.8 R, FEES 6.5.1 R, and FEES 6.5.6 R | R | With regard to contribution group A.19 General insurance mediation, the management expenses levy and compensation costs levy for 2005/2006 may also take account of expenditure in the period 14 January 2005 to 31 March 2005. | 14 January 2005 to 31 March 2006 | 31 October 2004 | ||
13 | FEES 6.5.7R (4), FEES 6.5.10 R, and FEES 6.5.13R (2) | R | For the period 31 October 2004 to 31 March 2006 the tariff base will be the annual income (relating to the relevant contribution group) reported in accordance with note 3 to AUTH 4 Annex 2 R or, if the firm prefers, that amount of its annual income which is attributable to business conducted with eligible claimants but only if the firm notifies FSCS of the amount by 28 February 2005. | 31 October 2004 to 31 March 2006 | 31 October 2004 | ||
14 | FEES 6.5.7R (5), FEES 6.5.11 R, and FEES 6.5.13R (2) | For the period 14 January 2005 to 31 March 2006 the tariff base will be the annual income (relating to the relevant contribution group) reported in accordance with note 3 to AUTH 4 Annex 2 R or, if the firm prefers, that amount of its annual income which is attributable to business conducted with eligible claimants but only if the firm notifies FSCS of the amount by 28 February 2005. | 14 January 2005 to 31 March 2006 | 31 October 2004 | |||
15 | COMP 5.4.4 R (4)(a) and COMP 5.4.4 R (4)(b) | R | The changes to COMP 5.4.4 R (4) made in the Compensation Sourcebook (Amendment No 7) Instrument 2006 do not apply in relation to defaults declared before 6 June 2006. | Indefinitely | 6 June 2006 |
COMP Sch 1
Record-keeping requirements
- 01/12/2004
COMP Sch 1.1
See Notes
1. | The aim of the guidance in the following able is to give the reader a quick overall view of the relevant record keeping requirements. The Rules listed below apply only to FSCS (the scheme manager). |
2. | It is not a complete statement of those requirements and should not be relied upon as it were. |
COMP Sch 1.2
See Notes
Handbook reference | Subject of record | Contents of record | When record must be made | Retention period |
FEES 6.3.14 R | FSCS funding | Full details of the movement of funds within sub-schemes. | Ongoing requirement. | N/A |
COMP Sch 2
Notification requirements
- 01/12/2004
COMP Sch 2.1
See Notes
1. | The aim of the guidance in the following table is to give the reader a quick overall view of the relevant requirements for notification and reporting. In all cases, other than those concerning Chapter 13 and Chapter 14, the notification rules in COMP apply only to FSCS (the scheme manager). |
2. | It is not a complete statement of those requirements and should not be relied on as if it were. |
COMP Sch 2.2
See Notes
Handbook reference | Matter to be notified | Contents of notification | Trigger event | Time allowed |
COMP 2.2.5G | Annual Report | Not specified in COMP - see Memorandum of Understanding (MoU) between FSAand FSCS | End of Financial Year | Not specified in COMP (see MoU) |
COMP 2.2.7R | Default of relevant person | Not specified - although FSCS must take appropriate steps to ensure claimants are informed about how they can claim compensation | default of a relevant person | Not specified - but as soon as practicable after determining default |
FEES 6.2.1 R | Right to exemption for specific costs and compensation costs levy | Notice that firm does not conduct business that could give rise to a claim on the FSCS and has no reasonable likelihood of doing so | If it does not, or if it ceases to, conduct business with persons eligible to claim on FSCS, unless it has already given such notice | None specified though exemption generally only takes effect from the date of receipt of notice by FSCS |
FEES 6.2.4 R | Loss of right to seek exemption from specific costs & compensation costs levy | Statement that firm no longer qualifies for exemption because it carries on business with persons eligible to claim on FSCS | Firm loses the right to claim the exemption. | As soon as reasonably practicable |
FEES 6.5.13 R | Levy base for participant firm | The contribution groups to which the participant firm belongs. The total amount of business (measured in accordance with the appropriate tariff bases, which it conducted as at 31 December of the previous year) | The end of the calendar year (the occasion of 31 December every year beginning with 31 December 2001) | By end February |
FEES 6.7 | Participant firms compensation levy for the financial year | Amount of levy payable by the participant firm | The decision by the FSCS that it must impose a levy | 30 days before the levy is payable |
COMP 14.2.1R | Application by eligible inward passporting EEA firm to obtain top-up cover into compensation scheme | That firm is qualifying incoming EEA firm. The sub-scheme(s) the firm wishes to participate in. Confirmation that the level or scope of cover offered by its home state scheme(s) is less than that available in the UK. | The firm's decision that it wishes to obtain top-up cover into the UK scheme. | N/A |
COMP 14.4.5R | Termination of top-up cover | Statement that incoming EEA firm is terminating top-up cover | Decision by firm to resign from FSCS | 6 months notice |
COMP 14.4.6R | Termination of inward passporting EEA firm's top-up cover into compensation scheme | The firm's resignation from the compensation scheme and the level of compensation available to clients of the firm's UK branch following its decision to resign from FSCS | Termination of firm's top-up cover | No later than six weeks after the end of the firms participation in compensation scheme |
COMP Sch 3
Fees and other required payments
- 01/12/2004
COMP Sch 3.1
See Notes
The rules in FEES 6 give FSCS (the scheme manager) the power to raise levies on participant firms in order to meet its expenses. The rules in FEES 6 do not specify the amount of any levy but do specify how a participant firm's share of a levy is to be calculated and any limit on the amount leviable by the FSCS is a particular period. |
COMP Sch 4
Powers Exercised
- 01/12/2004
COMP Sch 4.1
See Notes
The following powers and related provisions in or under the Act and the Financial Services and Markets Act 2000 (Transitional Provisions, Repeals and Savings) (Financial Services Compensation Scheme) Order 2001 ("the compensation transitionals order") have been exercised by the FSA to make the rules in COMP: |
Section 138 (General rule-making power) |
Section 156 (General supplementary powers) |
Section 213 (The compensation scheme) |
Section 214 (General) |
Section 215 (Rights of the scheme in relevant person's insolvency) |
Section 216 (Continuity of long-term insurance policies) |
Section 217 (Insurers in financial difficulties) |
Section 218 (Annual report) |
Section 223 (Management expenses) |
Section 316(1) (Direction by Authority) |
Article 4 (Pending Applications) of the compensation transitionals order |
Article 6 (Post-commencement applications) of the compensation transitionals order |
Article 9 (Article 9 defaults occurring before commencement) of the compensation transitionals order |
Article 9A (Contributions in relation to mesothelioma claims) of the compensation transitionals order. |
Article 10 (Applications in respect of compulsory liability insurance) of the compensation transitionals order |
Article 12 (Applications under the new scheme) of the compensation transitionals order |
COMP Sch 4.2
See Notes
The following additional powers have been exercised by the FSA to make the rules in COMP: | |
Articles 3 (Further power for Authority to make rules concerning mesothelioma claims) and 4 (Modification of FSMA in relation to FSA rules for mesothelioma claims) of the mesothelioma regulations. |
COMP Sch 4.3
See Notes
- 01/12/2004
COMP Sch 5
Rights of action for damages
- 01/12/2004
COMP Sch 5.1
See Notes
1. | The table below sets out the rules in COMP, contravention of which by an authorised person may be actionable under section 150 of the Act (Actions for damages) by a person who suffers loss as a result of the contravention. | |
2. | If a "yes" appears in the column headed "For private person?", the rule may be actionable by a "private person" under section 150 unless a "yes" appears in the column headed "Removed". A "yes" in the column headed "Removed" indicates that the FSA has removed the right of action under section 150(2) of the Act. If so, a reference to the rule in which it is removed is also given. | |
3. | In accordance with the Financial Services and Markets Act 2000 (Rights of Action) Regulations 2001 (SI 2001/2256) a "private person" is: | |
i | any individual, except when acting in the course of carrying on a regulated activity; and | |
ii | any person who is not an individual, except when acting in the course of carrying on business of any kind; | |
but does not include a government, local authority or an international organisation. | ||
4. | The column headed "For other person?" indicates whether the rule is actionable by a person other than a private person, in accordance with those Regulations. If so, an indication of the type of person by whom the rule is actionable is given. | |
5. | The vast majority of rules in COMP are rules to which the FSCS is subject. No right of action arises under section 150 for breach of these rules, as the FSCS is not an authorised person. |
- 01/12/2004
COMP Sch 5.2
See Notes
Chapter/Appendix | Section/Annex | Paragraph | For private person? | Removed | For other person? | |
COMP 1 | 5 | 8 | No | Yes - COMP 1.5.11 G | No | |
COMP 13 | Funding (all rules) | Yes | No | No | ||
COMP 14.4.6R | Yes | No | No |
COMP Sch 6
Rules that can be waived
- 01/12/2004
COMP Sch 6.1
See Notes
The rules in COMP cannot be waived by the FSA, except: |
(1) FEES 6.5.13 R ; |
(2) COMP 14.4.6 R |