A compensation scheme may pay an eligible claim when a financial firm cannot meet its obligations. It does not automatically reimburse a trading loss, and a broker's licence alone does not establish your eligibility. Check the legal company, service, claimant rules and event covered before relying on a headline limit.
Segregated client money, a statutory compensation scheme and private insurance are different arrangements. One does not prove that either of the others applies.
FSCS: check the activity as well as the company
The UK's FSCS investment guidance, read on 17 October 2026, states a limit of £85,000 per eligible person, per firm for firms that failed after 1 April 2019. This is the investment limit; do not substitute a limit advertised for bank deposits.
FSCS requires the provider or adviser to have the relevant authorisation and the service and product to fall within its scope. It does not cover poor investment performance. It may cover an eligible shortfall when a failed provider cannot return money or assets; eligible bad-advice claims can also fall within scope. This is broader than “only missing cash,” but it is not insurance against every unsuccessful trade.
Ask the firm which activity it performs for you and check that activity with FSCS. A brand's separate FCA-authorised company does not establish cover for your account with another group company.
Cyprus ICF: the ceiling is not an automatic payout
CySEC's ICF information, read on 17 October 2026, states that coverage is the lower of 90% of cumulative covered claims or €20,000 for a covered client against a fund member. Claims are considered across the covered services, not as a fresh allowance for every account.
The fund concerns covered money or financial instruments that a member cannot repay or return. Membership, client eligibility, a valid claim and the compensation procedure all matter. A delayed withdrawal is not itself confirmation that the ICF has been activated. Use CySEC's published process and the applicable deadline if a procedure is announced.
Australia: avoid both blanket assumptions
It is inaccurate to say Australia has no compensation scheme at all. ASIC describes the Compensation Scheme of Last Resort as covering eligible unpaid Australian Financial Complaints Authority determinations in specified areas: personal financial advice, credit intermediation, securities dealing and credit provision.
That does not create general reimbursement for every balance at an ASIC-licensed firm. Check the activity and the scheme's criteria rather than assuming that an OTC forex or CFD loss qualifies. A licence, a complaints decision and eligibility for a last-resort payout are separate questions.
Private insurance is another check
A broker may advertise insurance alongside its regulatory status. Ask for the insured legal company, insurer, policy period, covered events, exclusions, claim procedure and any limit shared across clients. Identify who can bring a claim and whether insolvency is covered. Do not add a policy headline to a statutory scheme limit as though both will pay you automatically.
Professional indemnity insurance is a specific example. ASIC's RG 126 explains that it is not designed to compensate consumers directly and does not ensure that a claim will be paid. Its existence is not equivalent to a personal deposit policy. Other private policies need their own terms checked; this guide has not assessed any particular broker's policy.
How to check your own position
- Record the exact company. Use the agreement, not a group licence badge. Start with the entity checker, then confirm the documents.
- Identify the service and your client classification. Check whether the scheme covers them and whether any exclusions apply.
- Confirm membership and the claim conditions. Read the scheme's official guidance, including limits and aggregation across accounts.
- Separate money owed from market losses. Keep statements and communications showing what happened; do not assume an on-screen balance is an accepted compensation claim.
- Follow the correct route. While a firm is operating, use its complaints process and any applicable dispute-resolution service. If it fails, follow the scheme's or administrator's published instructions and deadlines.
For example, two accounts with the same brand can name different legal companies. The first may meet a scheme's conditions; the second may fall outside that scheme. Even for the first account, you still need an eligible claim. Neither the shared brand nor your country alone settles the answer.
If the problem is a pending payment, the withdrawal checklist and verification-delay guide help identify the stage before you assume the company has failed. For an unresolved dispute, see how to complain about a broker.
Sources and correction
The linked FSCS, CySEC and ASIC sources were read on 17 October 2026. Limits and eligibility rules are jurisdiction-specific; the scheme assesses the individual claim.
Correction, 17 October 2026: qualified the earlier blanket FCA-client entitlement, added the ICF percentage condition, corrected the statement that Australia has no compensation scheme, and separated private insurance from statutory compensation. No individual account is assessed here.