The changes will come into effect from 1 January 2010.
Currently the compensation limit for investments and home finance advice is 100 per cent of the first £30,000 and 90 per cent of the next £20,000.
For non-compulsory insurance it is 100 per cent of the first £2,000 and 90 per cent of the remainder, with no upper limit.
FSA managing director of retail markets Jon Pain says: “The changes will help consumers understand and have confidence in the protection provided by the FSCS.
“In particular it removes the current potentially confusing provisions under which some parts of a claim can be paid out at 100 per cent and other parts at 90 per cent.”