What hapens if an Insurance Company goes Bust

MrMicawber_2

Does anyone know what happens to an annuity if the provider goes bust?

dunstonh

If the insurance company goes bust you should be able to claim compensation from the Financial Services Compensation Scheme (FSCS). This would look to provide you with approximately 90% of the value of your annuity. It should be emphasised however that it is rare for an insurance company to go bust. Most of the large insurance companies carry substantial reserves and even if something went wrong, it is possible that another insurer might want to purchase the company and take on its liabilities.

MrMicawber_2

Many thanks - is that 90% of the whole annuity whatever its value, or is it capped?

Retired_I.F.A.

90% of the annuity or your fund if you have not reached that stage.

Interesting to note that insurance companies have given that 90% g-tee since the insurance companies act of 1968 or was it '69 and final salary schemes never had till recently and that was only after the maxwell scandel, one of many that went belly up but the only one to hit the headlines.