The UK Government have supported the introduction of an insurance-based deposit protection scheme in England and Wales, from the Deposit Protection Service (DPS).
The new system is in addition to the DPS’s current custodial scheme.
Presently, the DPS holds the only custodial-based deposit protection scheme in England and Wales, and will be the only service offering both options to landlords and letting agents.
The number of approved insurance-backed schemes in England and Wales will also rise to three.
The introduction of the new insured scheme will launch in April 2013, however, landlords and letting agents can register in advance from October 1st.
Similarly to the custodial scheme, registering can be done online or by phone, and both can be organised through one online account.
Registration fees will not be charged for the insured scheme, and the DPS aim to provide competitive protection fees to landlords and letting agents.
All private landlords can use the insured scheme on a pay as you go basis, and letting agents must be members of a professional body, with Client Money Protection insurance.
Director of the DPS, Kevin Firth, says: “We’re delighted to be able to announce a new insurance-based deposit protection scheme from the DPS brand.
“We strive to provide the industry with an excellent service, and offering both insured and custodial options will ensure landlords and letting agents have the choice of protection from the leading supplier of TDP [tenancy deposit scheme] in the UK.”1
The DPS protect more than 900,000 deposits, following its launch in 2007.