How Much Compensation the Financial Ombudsman Can Award

If the Financial Ombudsman Service upholds your complaint, it can order the firm to put things right, and there is a ceiling on how much it can make a firm pay. For complaints referred on or after 1 April 2026 about acts or omissions on or after 1 April 2019, the maximum award is £455,000¹. For complaints referred on or after 1 April 2025 about acts or omissions on or after 1 April 2019, the maximum award is £445,000¹. For complaints referred on or after 1 April 2024 about acts or omissions on or after 1 April 2019, the maximum award is £430,000¹.

The figure that applies to your complaint is not simply the current one. It depends on two dates: when the firm's act or omission happened, and when you referred the complaint to the ombudsman. Complaints referred before 1 April 2019 had a £150,000 limit, and complaints about older acts or omissions have moved through a series of lower caps since¹.

The limit is the most the ombudsman can require a firm to pay. It can recommend a firm pays more, but the firm does not have to accept that recommendation². Distress and inconvenience payments sit alongside the main award, and the ombudsman can also award interest³.

The Financial Ombudsman award limit: up to £455,000

The award limit is the maximum amount the ombudsman can require a financial business to pay when it upholds a complaint⁵. It is not a target or a typical payout. Most awards are far smaller, and the limit only matters where the loss itself is large, such as a badly advised investment, a long-running mortgage problem or a serious insurance dispute.

For complaints referred on or after 1 April 2026 about acts or omissions on or after 1 April 2019, the maximum award is £455,000¹. The £445,000 figure applies to complaints referred on or after 1 April 2025 about acts or omissions on or after 1 April 2019¹. For complaints referred on or after 1 April 2024 about acts or omissions on or after 1 April 2019, the maximum award is £430,000¹. The ombudsman describes its power as deciding on an appropriate remedy, including a money award up to a limit set by the FCA, or a direction to the firm to do something².

The limit has moved repeatedly. It stood at £375,000 as of December 2022⁶, rose from £415,000 to £430,000 in April 2024⁴, and the £445,000 figure followed for complaints referred on or after 1 April 2025 about acts or omissions on or after 1 April 2019¹. For complaints referred on or after 1 April 2026 about acts or omissions on or after 1 April 2019, the ombudsman's own current limit is £455,000¹. A Which? guide published in December 2025 describes the maximum as £445,000 plus interest for complaints against a still-operating adviser or company⁷.

The ombudsman can also award compensation for distress and inconvenience on top of the main sum. Published guidance gives figures of up to £300 in one insurance context³, up to £1,500 in another⁸, and up to £5,000 in a third⁹. These are separate elements, not part of the headline limit.

Which limit applies depends on when the problem happened and when you complained

Two dates decide your cap: when the firm did the thing you are complaining about, and when your complaint reached the ombudsman. The table below sets out the published figures.

The pattern is that older problems attract lower caps, even when the complaint is made now. A problem that happened more than six years ago, but which the customer only became aware of within the last three years, can still be referred, and the limit that applies depends on when the complaint is referred rather than when the problem occurred¹.

There is also a time limit on complaining at all. The ombudsman's rule is six years from when the event happened, or three years from when you first realised, or could have realised, that you had a reason to complain, whichever is later¹⁰. A separate statement of the same rule describes it as up to six years from a problem happening, or longer if still within three years of the customer becoming aware, or of when they should reasonably have become aware, of the problem⁶. If your complaint is out of time, the limit never comes into play.

How the limit rises with inflation each tax year

The award limit is adjusted each year in line with inflation, as measured by the Consumer Prices Index⁵. That is why the figures change and why older published numbers go out of date. The FCA confirmed that from 1 April 2024 the limits would rise, and the ombudsman set out the new figures at that point⁵.

The same indexation principle appears across other compensation and benefit schemes, which helps explain the pattern. Funeral Support Payment increases with inflation each year¹¹. Pension protection payments rise in line with the Consumer Prices Index each year, up to 2.5 per cent, for service accrued after 6 April 1997¹². Some elements of Financial Assistance Scheme annual payments may be increased in line with inflation to a maximum of 2.5 per cent¹². In the tax system, indexation rules can work differently: one relief allowance is increased by the percentage rise in the consumer prices index for September compared with the previous September, rounded up to the nearest multiple of £1,000, for transfers on or after 6 April in the following year¹³.

The practical effect for a consumer is that the cap you read about today may not be the cap that applies to a complaint you make next year, and a figure quoted on an old web page may be years out of date.

Can the ombudsman recommend a firm pays more than the limit?

Yes, but only as a recommendation. The ombudsman has said that if it thinks compensation should be higher than its award limit, it can recommend that the financial business pays more². It has also said, in consumer guidance, that it can recommend a firm pays more if it thinks that is fair, but the business does not have to accept that recommendation².

That distinction matters. A recommendation above the limit is not enforceable in the way a decision is. In one published case, the ombudsman told a firm to pay a client compensation up to the applicable maximum of £160,000, and also recommended that the firm pay the full balance owed where the compensation amount exceeded £160,000¹⁴. The recommendation covered the excess; the enforceable part was capped.

Where a loss runs into hundreds of thousands of pounds, the ombudsman route may not recover all of it. The ombudsman has said that victims of high-value scams with losses above £85,000 may be able to escalate their complaint to it¹⁵, and the ombudsman can also ask a business to make an award for any distress and inconvenience caused¹⁶. But the cap still applies to what it can require.

Do I have to accept the ombudsman's decision?

No. The ombudsman makes a decision on your case and provides an outcome that is binding on the company, and you choose whether to accept it¹⁷. If you accept, the firm is bound. If you do not, you keep the option of going elsewhere, such as to court, though you give up the ombudsman outcome.

The ombudsman decides cases on what is fair and reasonable in the circumstances, not only on what a court would order. That shows in the case studies it publishes. In one, it decided it was not fair to reduce a claim payment on the basis that the customer had not estimated the full amount¹⁸. In another, it awarded £8,000 overall after finding an extreme level of impact caused to two policyholders over many years¹⁹.

The ombudsman can look at a wide range of complaints about financial products and services, including complaints related to the rising cost of living²⁰. Where a firm has set up a redress scheme, the ombudsman can assess whether the scheme rules have been followed: the FCA has said that if people disagree with their firm's decision on the motor finance compensation scheme, the Financial Ombudsman will be able to assess whether the scheme rules have been followed²¹.

If you disagree with a decision, there are routes to challenge it, and if you are waiting on an outcome there are published expectations about how long cases take.

Complaints to the Channel Islands Financial Ombudsman: up to £150,000

The Channel Islands has its own ombudsman, separate from the UK service. It can award compensation of up to £150,000⁴. That is a different scheme with different rules, and it does not share the UK limits.

If your complaint is about a firm in the Channel Islands, the UK Financial Ombudsman Service is not the right route. Which? sets the two side by side: the Channel Islands Financial Ombudsman can award up to £150,000, while Which? puts the UK's Financial Ombudsman Service at £445,000⁴. The ombudsman's own current limit is £455,000 for complaints referred on or after 1 April 2026 about acts or omissions on or after 1 April 2019¹.

Why some websites still quote £150,000 or £160,000

Those figures were correct when they were published. £150,000 applied to any complaint referred before 1 April 2019¹. £160,000 applied to complaints referred between 1 April 2019 and 31 March 2022 about acts or omissions by firms before 1 April 2019¹. Pages that have not been updated since then still show them.

The ombudsman's own web traffic makes clear how widely its figures circulate: in the 2011/2012 financial year, over 11,000 people logged onto its website each day, a 51 per cent increase on the previous year²², and in 2009/2010 the site recorded a monthly average of 210,000 visits²³. Old pages stay findable long after the figures on them change.

The rule of thumb is to check the date on any page quoting an ombudsman limit. If it predates the most recent 1 April, the figure may have been superseded.

Is the ombudsman award the same as FSCS protection?

No. They are two different schemes doing two different jobs, and the limits are not interchangeable.

The Financial Ombudsman Service resolves complaints against firms that are still trading. It can require a firm to pay compensation up to its award limit⁵. The Financial Services Compensation Scheme pays compensation when a firm has failed and cannot pay, and it protects a range of financial products, each with its own limit²⁴. For deposits, the FSCS limit is £120,000 per person or company, per authorised firm²⁵. Branches of the same legal entity count as the same business, so FSCS can protect up to £120,000 in total across accounts within the same credit union branches of the same legal entity²⁶.

The two schemes also cover different things. FSCS protection varies depending on the type of pension product, and there are limits to the amount it can compensate²⁷. It pays 100 per cent of whole of life assurance claims and 90 per cent of property claims²⁸, and credit insurance is not eligible for FSCS protection²⁹. Most types of general insurance are protected at 90 per cent, without an upper limit³⁰. A regulated broker is covered by the Financial Services Compensation Scheme³¹.

Both schemes only cover advice given by companies or individuals authorised by the Financial Conduct Authority³². If the firm was never authorised, neither route is available.

Where the protection stops

The award limit is a hard ceiling on what the ombudsman can require. Above it, the ombudsman can only recommend, and a firm can decline². For a loss well beyond the cap, that leaves the courts as the remaining route, with the costs and risks that involves.

The time limits are a second boundary. Six years from the event, or three years from when you realised or could have realised there was a reason to complain, whichever is later, is the window¹⁰. Complaints outside it are not decided on their merits.

The third boundary is authorisation. Both the FSCS and the ombudsman only cover advice given by companies or individuals authorised by the FCA³². If the firm was unregulated, neither scheme applies.

Where a firm has failed, the FSCS route has its own limits: £120,000 per person per authorised firm for deposits²⁵, 90 per cent for most general insurance without an upper limit³⁰, and product-specific limits for pensions and investments²⁷. Where a firm is still trading, the ombudsman route applies, with the caps set out above.

Free, impartial help is available. MoneyHelper provides guidance on using an insurance broker and on financial matters generally³¹. The ombudsman's own service is free to consumers, and it publishes its approach to deciding cases¹⁷.