The Financial Ombudsman Service has increased its maximum award limit from £375,000 to £415,000.
From April 1, the Fos award limit will change to £415,000 for complaints referred to it about acts or omissions by firms on or after April 1 2019.
Meanwhile, for complaints referred to it about acts or omissions by firms before April 1 2019, the award limit has been increased from £170,000 to £190,000.
The increase was confirmed by the Financial Conduct Authority this week (March 20) who raised the limit in line with inflation, as measured by the consumer price index.
Yesterday (March 22) the rate of inflation unexpectedly rose in February to 10.4 per cent.
The compensation award increase by the Fos is in line with prior increases by the organisation.
Last year, the maximum award was increased from £350,000 to £375,000.
Figures released yesterday showed that the Fos received a total of 79,921 new complaints in the second half of last year, up from 72,978 in the first half of the year.
It upheld 34 per cent of complaints in the consumers’ favour in the latter half of the year compared to 37 per cent in the first six months of 2022.
Complaint backlog
The Fos has been under pressure in recent years over the handling of its complaints backlog.
In 2021, former Fos chief Caroline Wayman stepped down after seven years in the role when it was revealed that the ombudsman was facing a backlog of 158,000 complaints.
Since then, the organisation’s backlog has been reduced to 29,000 cases, but MPs have questioned whether there has been a trade off between speed and quality of complaint handling.
Chief executive Abby Thomas moved to reassure MPs earlier this month and told them the organisation is on the right track in tackling the backlog.
jane.matthews@ft.com
What do you think about the issues raised by this story? Email us on ftadviser.newsdesk@ft.com to let us know
