The Single Financial Guidance Body has put its support behind the FCA over the increase in the Financial Ombudsman Service‘s compensation limit, saying it will prove advantageous to consumers thinking about transferring their defined benefit pensions.
The FCA confirmed last week that the FOS redress limit would rise by £200,000 to £350,000 from 1 April, meaning consumers will have access to a higher level of compensation from financial services firms when a complaint is upheld.
SFGB head of pensions guidance services Charlotte Jackson says the added protection of the limit raise is encouraging for people looking to switch out of a DB scheme.
She says: “[The award limit increase] will give added protection and assurance to consumers when using a certified regulated financial, should things go wrong. This will be particularly important for people looking to transfer from a defined benefit scheme.”
The body also warns consumers to check that their financial adviser is registered before proceeding with a transfer, following a difficult 12 months for DB transfer advice.
The SFGB, which replaces the Money Advice Service, Pensions Wise and the Pensions Advisory Service, will be rebranded as the Money and Pensions Service from 6 April.