What happens if my employer or pension company goes bankrupt?
Pensions business is treated the same as 'long-term' insurance and in the event your pension company should have financial difficulties and go out of business, you would be covered under the Financial Services Compensation Scheme.
Under the scheme, compensation in respect of life insurance is unlimited. You would be paid the first £2,000 of your pension fund in full and 90% of the remainder, without upper limit.
For more information, see The Financial Services Compensation Scheme.
If you are in a final salary scheme and your employer goes out of business, your pension scheme benefits are separate from your employer and should be able to provide you with the expected benefits. If the pension cannot do this, you may be protected by the Pension Protection Fund.
