Are ISA's included in the Government £75000 guarantee

BrianWilliams

In the Government Guarantee of funds up to £75000 being protected for each financial organisation are ISA's included are are they covered under under a separate rule so you can have ISA's plus £75000 with one financial organisation and be covered by government guarantees for both?

jamesd

No savings or investments are included in a government £75,000 guarantee because there is no such thing as a £75,000 government guarantee.

Cash ISAs including HTB, that are deposits are protected by the usual Financial Services Compensation Scheme £75,000. This scheme is funded by the banks and other institutions involved, with loans from the Bank of England used to smooth out any unusually larger bills.

In the unlikely event that you have a cash ISA that includes funds, that would have the lower £50,000 protection for investments and normal investment losses would not be covered by the FSCS. The protection would be for each fund management house so it could easily exceed £50,000 or £75,000 if you used more than one fund management firm's investments.

S&S ISAs will normally have the £50,000 investment protection but it is possible for some money to be held on deposit and benefit from up to £75,000. The ISA manager is supposed to make it clear which limits apply to each use of the money.

The FSCS protection always covers all of your money with the institution, whatever accounts are involved, so you do not get more than one chunk of £75,000 and/or £50,000 if you use different accounts at different places. The amount at each place is added up and you get the portion that is within the limit covered.

Say you had £80,000 in a deposit account and £20,000 in a cash ISA with HSBC. Your protection would be a total of £75,000 and you could lose up to £25,000.