TaxPersonal TaxCost of pensions mis-selling set to rise

Cost of pensions mis-selling set to rise

The cost of the pensions mis-selling scandal is to rise by around five per cent, resulting in an increased cost to insurers of between £190m and £325m instead of the original forecast of over £500m by the Financial Services Authority.

The FSA announcement follows additional research conducted by PricewaterhouseCoopers which indicates that up to 35% of second phase cases, so-called non-urgent cases, will receive higher compensation.

The FSA’s announcement follows a change to how pensions are calculated for younger victims of the mis-selling scandal.

The FSA halted all the processing last December of all phase two reviews related to pensions sold in the late 1980s and early 1990s when the regulator found problems with the method of calculating compensation.

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