Levy doubles from original FSCS estimate for advisers
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The FSCS levy for the life and pension adviser sub-class has more than doubled compared with original estimates for 2011/12 due to a higher number of mortgage endowment and pension complaints.
The sub-class will be hit with a £21.5m levy compared with an earlier estimate of £10.5m. This compares with £9.6m for 2010/2011.
Advisers in the investment intermediary sub-class will have to pay an annual levy of £34m, compared to the £40m estimated in February, and up from £20.3m the previous year. Advisers in this sub-class were also hit with a £93m interim levy for 2010/2011, mostly due to Keydata.
The FSCS has announced that the total annual levy for 2011/12 has gone down from the indicative £240m levy bill estimated in February to £217m, although this is up from £148m raised through the annual levy last year. The FSCS says the increase in the levy for life and pension advisers is due to high levels of mortgage endowment and pension claims. Its updated analysis shows a greater proportion of claims from life and pension intermediation activities than in previous years.
Chief executive Mark Neale says: “With the exception of the life and pensions intermediation sub-class, the proposed levy for each sub-class either remains the same or has been reduced.
“Our levies are based on projections of the number and value of claims we expect to pay in 2011/12. Before we set the final levy, we review all our assumptions and claim figures.”
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