Insurance for bank deposits

If you've been storing up a lot of money and putting it in your bank you might need to know about insurance for bank deposits. You don't want to be one of the unlucky ones knocking on a bank or building society's door when news arrives of another banking collapse.

UK regulations

The collapses of banks like Northern Rock, Bradford Bingley, Icelandic is now a distant memory but it's something that none of us expected to experience. These unfortunate events have led to new rules and regulations within the banking sector. You'll be happy to learn that in the UK we have a government backed initiative that guarantees savings up to £85,000. This Government-backed Financial Services Compensation Scheme (FSCS) means that if the bank fails, you can guarantee to receive £85,000 per person, per financial institute.

Multiple banks

In a lot of cases the FSCS has led savers to split their savings across different banks and building societies. These savers only put £85,000 or less into each bank account. This is a very sensible way of doing things but it's not the most lucrative because the more money you save with a bank, the higher the interest rate will be. This is where insurance for bank deposits comes in.

Insurance for bank deposits

Any UK resident who's put their money into accounts overseas will have heard of bank deposit insurance as it's something that financial experts tend to suggest when you're saving a lot of cash. Is this worth doing when you're saving money with UK banks?

Bank deposits insurance

Insurance for bank deposits might be necessary if the institute you're banking with in the UK isn't registered in this country. You should find out where your bank or building society is licenced as this affects whether you'll be covered by the guaranteed £85,000 scheme or not. For example banks operating in the crown dependencies of Gibraltar, Guernsey, Isle of Man and Jersey will have different limits set by the FSCS.

United Kingdom - Excite Network Copyright ©1995 - 2022