| Link(s): | Our May 2022 Outlook | FSCS |
Context
The FSCS has published its May 2022 Outlook update. This includes the latest compensation and overall levy forecast for 2022/23.
Key points to note
- The FSCS has slashed its annual levy to £625m due to a reduction in expected claims. In November 2021 the forecasted levy for the year 2022/2023 was £900m.
- The majority of this decrease was due to:
- a £54m reduction in compensation paid in the LDII class due to fewer complex pension claims being received than previously forecast;
- a £14m reduction in compensation paid in the Investment Provision class due to fewer SIPP operator failures than previously forecast; and
- a £56m reduction in compensation paid in the General Insurance Provision class.
- The final levies for 2022/23 are £5.3m for intermediaries and £211.7m for insurers, down significantly on initial estimates.
- The update also outlines FSCS priorities for 2022/23 which includes embedding funeral plans into scope, working on customer experience of the future and working on clearly defining FSCS’s ambition for consumers.
Next actions
None – for information and awareness.