This article is from the source 'independent' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.independent.co.uk/news/business/news/financial-services-see-compensation-bill-rocket-again-9074984.html

The article has changed 3 times. There is an RSS feed of changes available.

Version 0 Version 1
Financial services see compensation bill rocket again Financial services see compensation bill rocket again
(35 minutes later)
Financial services firms will have to stump up an extra £28 million next year to cover the cost of compensating customers of companies that go bust.Financial services firms will have to stump up an extra £28 million next year to cover the cost of compensating customers of companies that go bust.
Investment intermediaries were also hit with a more immediate cash demand, with the Financial Services Compensation Scheme warning they will be asked to hand over an extra £30 million before the end of the current financial year. Meanwhile, investment intermediaries face a more
The demands came in the FSCS’s 2014/15 budget, published today, notifying finance firms of the 17% increase in the annual levy from £285 million to  £313 million. immediate cash demand: the FSCS warned they will be asked to hand over an extra
The continuing high numbers of mis-sold payment protection insurance claims will lead to a 20 per cent increase in compensation payouts next year, the FSCS predicted. General insurers will be asked to pay £62 million towards the scheme next year, mainly to cover the cost of the PPI claims. £30m before the end of the current 2013/14 year.
The levy for life and pensions advisers will triple from £13 million to £40 million as pension claims, particularly related to self-invested personal pensions, are expected to rise. The figures were published this morning by the Financial
The extra £30 million investment advisers will be asked for will mainly cover the cost of the failure of Catalyst Investment, which was declared in default in October. Services Compensation Scheme which published its 2014/15 budget notifying
That collapse, and expected claims against Catalyst, has also contributed to an increased demand of 34 per cent on investment advisers for 2014/15, with the sector’s share of the levy climbing from £78 million to £105 million. finance firms of the 17 per cent increase in the annual levy from £285m to
Catalyst promoted life settlement bonds backed by Arm Asset Backed Securities. Last week the British Insurance Brokers’ Association claimed the FSCS is negatively impacting brokers, with more than half delaying or cutting investment as a result. £313m.
FSCS chief executive Mark Neale said: "Our mission is to provide a responsive, well-understood and efficient compensation scheme for customers of financial services, which raises public confidence in the industry." The extra £30m investment advisers will be asked for will
mainly cover the cost of the Catalyst Investment group failure, which was
declared in default in October.
That collapse - and expected claims against Catalyst -
has also contributed to an increased demand of 34 per cent on investment
advisers for 2014/15, with the sector's share of the levy climbing from £78m to
£105m.
Catalyst promoted life settlement bonds backed by Arm
Asset Backed Securities. The FSCS expects to be able to start inviting claims
against Catalyst in February or March.
The levy for life and pensions advisers will triple from
£13m to £40m as pension claims - particularly with Sipps - are expected to
rise.
Meanwhile general insurers will be asked to pay £62m
towards the scheme next year mainly to cover the cost of payment protection
insurance claims. The continuing high numbers of missold PPI claims will lead
to a 20 per cent increase in compensation payouts next year, the FSCS predicted.
However it said it expects an increase in compensation
costs in the general insurance provision sector because of noise-induced
hearing loss and mesothelioma claims against Chester Street, Builders Accident
Insurance and Independent Insurance.
Last week the British Insurance Broker's Association
warned that FSCS are negatively impacting brokers, with more than half delaying
or cutting investment as a result.
Steve White, BIBA's chief executive, said: “Having the
most expensive fees and levies in the world puts UK brokers at a disadvantage
and is disproportionate to the low risks that they pose to the regulator’s
objective.”
FSCS chief executive Mark Neale said: "Our mission
is to provide a responsive, well-understood and efficient compensation scheme
for customers of financial services, which raises public confidence in the
industry. We invite stakeholders' responses to this consultation."
The organisation’s plan and budget will remain open for
consultation until 21 February.