In short
- The FSCS covers eligible investment claims up to £85,000 per person, per firm.
- It only applies when an FCA-authorised firm fails.
- It doesn't cover trading losses or offshore entities.
How it fits with client money rules
Your first protection is segregation: FCA brokers must hold retail client money separately from their own. If a broker fails, segregated money is returned through the insolvency process. The FSCS is the safety net for any shortfall.
What's covered and what isn't
| Covered | Not covered |
|---|---|
| Client money a failed FCA firm can't return | Losses from market movements |
| Eligible claimants (most individuals) | Accounts with offshore entities |
| Up to £85,000 per person per firm | Amounts above the limit |
Practical tips
- Confirm your account is with the FCA-authorised entity.
- If your balance exceeds £85,000, consider spreading funds across separately authorised firms.
- Keep records of your account statements.
Frequently asked questions
Does the FSCS cover trading losses?
No. It only covers money the broker owes you but can't return because it has failed.
Is the £85,000 limit per account?
It's per person, per firm for investment claims. Separate firms within the same group may count separately if they're separately authorised — check the FSCS's guidance.
CFDs and spread bets are complex instruments and come with a high risk of losing money rapidly due to leverage. Most retail investor accounts lose money when trading these products. You should consider whether you understand how they work and whether you can afford to take the high risk of losing your money.