The IFA sector will be billed £47.5m by the Financial Services Compensation Scheme this year - an increase of 25% on last year and equivalent to between £1,200 and £1,300 per adviser.
In its 2006/07 Plan and Budget, the FSCS says the increase in levies is down to the high volume of new endowment cases received last year - currently forecast at 22,000 – which it expects to continue into 2006/07. By contrast, the FSCS predicts the levy for all sectors in total will fall from £138m to £75.4m, reflecting the recent large recoveries from the estates of insolvent general insurers and a short-term reduction in funding requirements for claims in the sector. Loretta Minghella, chief executive of the FSCS, says: “Inevitably, the rise in the numbers of endowment claims we hav...
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