COMP 5
Protected claims
COMP 5.1
Application and Purpose
- 01/12/2004
Application
COMP 5.1.1
See Notes
This chapter applies to the FSCS.
- 01/12/2001
COMP 5.1.2
See Notes
It is also relevant to claimants.
- 01/12/2001
Purpose
COMP 5.1.3
See Notes
The purpose of this chapter is to set out the various categories of claim for which compensation may be payable.
- 01/12/2001
COMP 5.2
What is a protected claim?
- 01/12/2004
COMP 5.2.1
See Notes
A protected claim is:
- 06/08/2009
COMP 5.2.2
See Notes
[deleted]
- 13/02/2004
COMP 5.2.3
See Notes
Notwithstanding COMP 5.2.1 R, where the relevant personin default:
(1) is an authorised professional firm that is subject to the rules of the Law Society (England and Wales) or the Law Society of Scotland; and
(2) with respect to its regulated activities, does not participate in the relevant society's compensation scheme:
a claim with respect to that person is only a protected claim if, when the basis for the claim arose, that person did not participate in the relevant society's compensation scheme with respect to its regulated activities.- 09/12/2011
COMP 5.3
Protected deposits and protected dormant accounts
- 06/08/2009
COMP 5.3.1
See Notes
A deposit is a protected deposit only if:
(1) the deposit was made with:
(b) a branch of a UK firm which is a credit institution established in another EEA State under an EEA right; and
(2) the deposit is not:
(a) a bond issued by a credit institution which is part of the institution's capital, as set out in the Consolidated Banking Directive (Directive 2000/12/EC); or
(b) a secured deposit; or
(c) a deferred share issued by a building society; or
- 08/01/2012
COMP 5.3.2
See Notes
If not a protected deposit, a dormant account is a protected dormant account only if, immediately prior to transfer, it consisted of a protected deposit, the liability for which has been transferred to a dormant account fund operator.
- 06/08/2009
COMP 5.4
Protected contracts of insurance
- 01/12/2004
COMP 5.4.1
See Notes
A protected contract of insurance is:
(1) (if issued after commencement) a contract of insurance within COMP 5.4.2 R (Contracts of insurance issued after commencement)
(2) (if issued before commencement) a contract of insurance within COMP 5.4.5 R (Contracts of insurance issued before commencement)
- 01/12/2001
Contracts of insurance issued after commencement
COMP 5.4.2
See Notes
A contract of insurance issued after commencement which:
(1) relates to a protected risk or commitment as described in COMP 5.4.3 R;
(2) is issued by the relevant person through an establishment in;
(a) the United Kingdom; or
(b) another EEA State; or
(c) the Channel Islands or the Isle of Man;
(4) is not a reinsurance contract; and
(5) if it is a contract of insurance entered into by a member, was entered into on or after 1 January 2004
is a protected contract of insurance.- 01/01/2004
COMP 5.4.3
See Notes
A risk or commitment is a protected risk or commitment for the purpose of COMP 5.4.2 R(1) if:
(1) in the case of a contract of insurance falling within COMP 5.4.2 R(2)(a), it is situated in an EEA State, the Channel Islands or the Isle of Man;
(2) in the case of a contract of insurance falling within COMP 5.4.2 R(2)(b), it is situated in an EEA State except that where the relevant person is a firm which is not a UK firm issuing a contract of insurance through an establishment in an EEA State (other than the United Kingdom), the risk or commitment must be situated in the United Kingdom;
(3) in the case of a contract of insurance falling within COMP 5.4.2 R(2)(c), it is situated in the United Kingdom, the Channel Islands or the Isle of Man.
- 25/07/2008
COMP 5.4.4
See Notes
For the purpose of COMP 5.4.3 R and COMP 5.4.5 R(1)(b), the situation of a risk or commitment is determined as follows:
(1) for a contract of insurance relating to a building or a building and its contents (in so far as the contents are covered by the same contract of insurance), the risk or commitment is situated where the building is situated;
(2) for a contract of insurance relating to vehicles of any type, the risk or commitment is situated where the vehicle is registered;
(3) for a contract of insurance lasting four months or less covering travel or holiday risks (whatever the class concerned), the risk or commitment is situated where the policyholder took out the contract of insurance; and
(4) in cases not covered by (1) to (3):
(a) where the policyholder who first took out the contract of insurance is an individual, the risk or commitment is situated where he has his habitual residence at the date when the contract of insurance commenced;
(b) where the policyholder who first took out the contract of insurance is not an individual, the risk or commitment is situated where the establishment to which the risk or commitment relates is situated at the date when the contract of insurance commenced.
- 06/06/2006
Contracts of insurance issued before commencement
COMP 5.4.5
See Notes
(1) If after commencement, a relevant person is subject to one or more of the proceedings listed in COMP 6.3.3 R or is declared in default, then a contract of insurance issued by that relevant person before commencement which is within COMP 5.4.5 R(2) is a protected contract of insurance, provided that the relevant person was not a member at the time the contract of insurance was issued, and:
(a) (unless it comes within (b)) at the earlier of the events in (1) it was a "United Kingdom policy" for the purposes of the Policyholders Protection Act 1975;
(b) if the contract of insurance is a contract of employers' liability insurance entered into before 1 January 1972 or (for contracts in Northern Ireland) 29 December 1975, and the claim was agreed after the default of the insurer, the risk or commitment was situated in the United Kingdom (as set out in COMP 5.4.4 R).
(2) The contracts of insurance referred to in COMP 5.4.5 R(1) are:which in each case is not a reinsurance contract.
- 01/01/2004
Contracts not evidenced by a policy
COMP 5.4.6
See Notes
If it appears to the FSCS that a person is insured under a contract with an insurance undertaking which is not evidenced by a policy, and it is satisfied that if a policy evidencing the contract had been issued, the person in question would have had a protected contract of insurance, the FSCS must treat the contract as a protected contract of insurance.
- 01/12/2001
Liabilities giving rise to claims under a protected contract of insurance
COMP 5.4.7
See Notes
The FSCS must treat liabilities of an insurance undertaking which is in default, in respect of the following items, as giving rise to claims under a protected contract of insurance:
(1) (if the contract is not a reinsurance contract and has not commenced) premiums paid to the insurance undertaking; or
(2) proceeds of a long-term insurance contract that is not a reinsurance contract and that has matured or been surrendered which have not yet been passed to the claimant; or
(3) the unexpired portion of any premium in relation to relevant general insurance contracts which are not reinsurance contracts; or
- 01/12/2003
COMP 5.5
Protected investment business
- 01/12/2004
COMP 5.5.1
See Notes
Protected investment business is:
(1)
designated investment business carried on by the relevant person with, or for the benefit of, the claimant (so long as that claimant has a claim), or as agent on the claimant's behalf;
(2) the activities of the manager or trustee of an AUT, provided that the claim is made by a holder;
(3) the activities of the ACD or depositary of an ICVC, provided that the claim is made by a holder;
provided that the condition in COMP 5.5.2 R is satisfied.- 06/04/2007
COMP 5.5.2
See Notes
COMP 5.5.1 R only applies if the protected investment business was carried on from:
(2) a branch of a UK firm which is:
(b) a UCITS management company established in another EEA State (but only in relation to managing investments (other than
collective portfolio management),
advising on investments or safeguarding and administering investments);
(3) both (1) and (2); or
(4)
and in either case the management company is providing collective portfolio management services for a UCITS scheme but only if the claim relates to that activity.
(b) an establishment of such an EEA UCITS management company in its Home State from which cross border services are being carried on;
and in either case the management company is providing collective portfolio management services for a UCITS scheme but only if the claim relates to that activity.
- 01/07/2011
COMP 5.6
Protected home finance mediation
- 06/04/2007
COMP 5.6.1
See Notes
Protected home finance mediationis:
(4)
agreeing to carry on a regulated activity in (1) to (3); or
(5) the activities of a
home finance provider
which would be arranging but for article 28A of the Regulated Activities Order (Arranging contracts or plans to which the arranger is a party);
provided that the condition in COMP 5.6.2 R is satisfied.- 06/04/2007
COMP 5.6.2
See Notes
COMP 5.6.1 R applies only if the
protected home finance mediation
was carried on by a relevant person:
(2) from an establishment maintained by the relevant person (or its appointed representative) in the United Kingdom with a customer who was resident elsewhere in the EEA;
at the time the
protected home finance mediation
was carried on.- 06/04/2007
COMP 5.7
Protected non-investment insurance mediation
- 01/12/2004
COMP 5.7.1
See Notes
Protected non-investment insurance mediation is an insurance mediation activity where the investment concerned is a
relevant general insurance contract or a pure protection contract but which is not a
long-term care insurance contract or a
reinsurance contract, provided that the conditions in COMP 5.7.2 Rare satisfied.
- 18/11/2005
COMP 5.7.2
See Notes
COMP 5.7.1 R only applies if the conditions in (1) and (2) are satisfied:
(1) the protected non-investment insurance mediation was carried on from:
(2) the claimant making the claim (or where COMP 3.2.4 R applies, the customer on behalf of whom a firm makes a claim) dealt initially, with a view to entering into a relevant general insurance contract or a pure protection contract but not a long-term care insurance contract or a reinsurance contract, with an intermediary that was:
(a) established in the United Kingdom; or
- 18/11/2005
COMP 5.7.3
See Notes
The FSCS will not cover a claim against an intermediary that meets the criteria of either COMP 5.7.2R (2)(a) or COMP 5.7.2R (2)(b) where the claimant was introduced to that intermediary by an intermediary that does not meet the criteria of either COMP 5.7.2R (2)(a) or COMP 5.7.2R (2)(b).
- 18/11/2005
COMP 5.7.4
See Notes
The FSCS will not cover a claim in respect of an intermediary that is not a relevant person, for example a retailer selling extended warranties that are connected contracts. However, COMP 5.7.2 R has the effect that a claim in respect of a relevant person further up the chain carrying on protected non-investment insurance mediation in accordance with COMP 5.7.2R (1)(a) may be covered by the FSCS if the claimant dealt initially with a UK intermediary that is not a relevant person.
- 18/11/2005