Financial Services Compensation Scheme (FSCS) in the Insurance Industry

Financial Services Compensation Scheme (FSCS) in the Insurance Industry

Learning Objectives

At the end of the lesson you will understand the purpose of the FSCS within the insurance industry. At the end of the lesson you will know the types of insurance coverage protected by the FSCS. At the end of the lesson you will be able to explain how the FSCS provides protection to policyholders. At the end of the lesson you will recognize the limits of compensation provided by the FSCS for various insurance products.

What do you already know about the Financial Services Compensation Scheme (FSCS)?

Purpose of the FSCS in the insurance industry

The FSCS serves a crucial role in providing a safety net for policyholders in the event of an insurance firm's failure. It is designed to maintain confidence in the financial services sector and safeguard the interests of policyholders.

Types of insurance coverage protected by the FSCS

The FSCS covers a range of insurance products, ensuring that consumers are protected and can receive compensation up to certain limits.

Protection mechanism of the FSCS for policyholders

Policyholders are entitled to coverage under the policy terms and can receive compensation when authorized financial services firms fail.

Compensation limits of the FSCS for different insurance products

The FSCS provides compensation to eligible claimants up to certain limits in the event of a firm's failure.

Definition List

FSCS: A UK statutory fund that provides compensation to policyholders when authorized financial services firms fail. Policyholder: An individual or entity who owns an insurance policy and is entitled to coverage under the policy terms. Compensation limit: The maximum amount the FSCS will pay out to an eligible claimant in the event of a firm's failure.

Write down 3 things you learned in this lesson.

Have students enter three things they learned in this lesson. With this they can indicate their own learning efficiency of this lesson.

Write down 2 things you want to know more about.

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Ask 1 question about something you haven't quite understood yet.

The students indicate here (in question form) with which part of the material they still have difficulty. For the teacher, this not only provides insight into the extent to which the students understand/master the material, but also a good starting point for the next lesson.