§ Mr. Steve WebbTo ask the Chancellor of the Exchequer on what basis, and on what date, the value of the assets of a financial institution are valued for purposes of calculating the level of compensation available under the Financial Services Compensation Scheme; and if he will make a statement on the way in which the scheme would apply to policy holders of a life assurance and pensions provider in the event of the company becoming insolvent. [93357]
§ Ruth Kelly[holding answer 27 January 2003]: The valuation of assets of a financial institution does not affect the level of compensation available under the Financial Services Compensation Scheme (FSCS). The FSCS can pay compensation when an authorised financial institution is unable, or likely to be unable, to meet the claims against it and the valuation of the assets of the institution may be a relevant factor in the FSCS's decision.
The basis on which claims against a financial institution are valued are set out in the Financial Services Compensation Scheme's Rules.
How the Scheme would apply to policyholders of an insolvent life insurer is also covered in the Scheme's Rules.
The Rules are written by the Financial Services Authority (the FSA), and form part of the FSA Handbook under 'Redress, Compensation'. The Rules are readily available, and can be viewed by accessing the FSA website, www.fsa.gov.uk.