You can apply for compensation by using our online application form.
To be eligible for compensation from us, you need to meet the requirements set out in sections 182 to 187 of the Pensions Act 2004, and in the Occupational Pension Schemes (Fraud Compensation Payments and Miscellaneous Amendments) Regulations 2005.
The legislation sets out the requirements that must be met for you to be eligible to make an application:
- The scheme must be an occupational pension scheme
- The employer has become insolvent or is unlikely to continue as a going concern - and your pension scheme can’t be rescued
- Your scheme can’t be an ineligible scheme as set out in regulation 2 of the 2005 Regulations
We can only pay out compensation directly to the scheme trustees, and only after we’ve made the final decision and the settlement date has been set. We can’t pay compensation directly to members.
The trustees remain responsible for administering the occupational pension scheme in accordance with the scheme rules.
How to apply
You must provide all the information and documentary evidence required on the application form otherwise we may not be able to assess your claim. If you can’t provide all the necessary information, you’ll need to explain why not.
We may need to gather evidence from third parties. The application form asks for your consent to do this.
Who can apply?
Any trustee, scheme manager, member or beneficiary (or authorised representatives) can make a claim but if it’s successful we can only pay out directly to the scheme trustees.
When an application can be made?
You can apply within an authorised period which is 12 months from the latest date of:
- the date of the insolvency notice for defined contribution schemes, or
- the date of your employer’s insolvency or when your employer stopped being a going concern for defined benefit schemes, or
- the time when the trustees, scheme managers, accountants or scheme actuaries discovered that the scheme assets had been reduced as a result of offences involving dishonesty
In exceptional circumstances we may be able to accept applications outside the authorised period, but you’ll need to provide evidence to support the reason for the delay.
What happens once an application has been made?
After we’ve received your application, we’ll let you know if we need any more information.
Unfortunately, the process can take a long time. We aim to process every application within six months to two years, but the time it takes will vary with every case. Here’s an overview of the steps involved.
Compensation from us is the last resort and in accordance with the law we need to assess the evidence, and consider whether assets can be recovered.
When we have all the necessary information, we’ll make a decision and let you, or your representative, know as soon as possible. An explanation of the reasons behind our decision will be provided too.
If your claim is successful
We’ll send a determination letter to the trustees, with a copy to the applicant, explaining the amount, and any terms and conditions of the compensation payment.
How we calculate fraud compensation
The calculation is based on what an accountant determines is the difference between the value of the scheme’s net assets before the loss and the value of the net assets before the application date.
You can find more details about this in section 185 of the Pensions Act and regulation 7 of the Occupational Pension Schemes (Fraud Compensation Payments and Miscellaneous Amendments) Regulations 2005.
If you disagree with our decision
If you or any of your representatives want to query a decision, you should contact us. We can often sort out any problems or concerns quickly and easily.
If you’re dissatisfied with our response, you can make a formal request to review the decision. An application to review a decision can generally be made within 28 days of the date the decision is received. We’ll send information about how and when to request a review with any decision letter.