FSCS Temporary High Balance Protection Extended From 6 Months to 12 Months

The Financial Services Compensation Scheme (FSCS) protects Temporary High Balances (THB) of up to £1million resulting from certain specific key life events, held with UK authorised banks.

This FSCS protection begins from the date the THB is credited to an individual depositor's account and the length of that protection has been extended from six months to 12 months.

This six-month extension applies to both new and existing THBs. Therefore, money deposited into an account with an authorised UK bank or building society in February 2020, with the six-month THB coverage previously due to end in August 2020, is now protected until February 2021. Similarly, if a qualifying THB is deposited in October 2020, the protection will now apply until October 2021, as opposed to April 2021.  

Caroline Rainbird, FSCS Chief Executive said: “The coronavirus pandemic has been very worrying for everyone, and people are understandably concerned about the possibility of losing their temporary high balance should their deposit taker fail. The temporary extension of FSCS’s protection from six to 12 months will do much to reassure them should the worst happen during these uncertain times.”  

The list of specific circumstances, detailed by the FSCS, which could result in a temporary high balance include:

  • Real estate transactions (property purchase, sale proceeds, equity release - relating to the client’s main residence only).
  • Benefits payable under an insurance policy.
  • Personal injury compensation (unlimited amount).
  • Disability or incapacity (state benefits).
  • Claim for compensation for wrongful conviction.
  • Claim for compensation for unfair dismissal.
  • Redundancy (voluntary or compulsory).
  • Marriage or civil partnership.
  • Divorce or dissolution of their civil partnership.
  • Benefits payable on retirement.
  • Benefits payable on death.
  • A claim for compensation in respect of a person's death.
  • Proceeds of a deceased's estate held by their personal representative.

It is worth noting that THB protection specifically is not provided for proceeds from the sale of a business.

The provision of this 12-month THB protection by the FSCS is a temporary measure and any THB qualifying deposits placed after 1 February 2021 will revert to benefitting from just six months’ protection. All other aspects of the rules around THBs after that date will remain the same.  

Further information on THBs can be found on the FSCS website at fscs.org.uk/how-we-work/temporary-high-balances/.


To discuss how we can support you in delivering optimal outcomes for your clients as part of your savings and investment proposition, call us on 0203 745 8130 or contact us at BusinessDevelopment@FlagstoneIM.com. Flagstone currently1 offers clients access to 33 exclusive deposit rates and a choice of more than 250 accounts from 45 partner banks.


1 As at 7 September 2020



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