Sipps related claims are behind a £20m interim levy on life and pensions intermediaries announced by the FSCS today.
Officials said this morning that the costs and volume of claims relating to "bad advice by financial advisers to transfer funds from existing pension schemes into self-invested personal pensions" are driving the interim levy.
In many cases the Sipp fund was then invested in non-standard asset classes, which have become illiquid, the FSCS said, adding that these included some with investments in offshore property schemes.
Initially, FSCS started making interim compensation payments to claimants where such advice resulted in lost pension growth and charges. However, FSCS has now started also compensating claimants for losses in the value of investments held in Sipps.

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Firms in this sector will start to receive invoices for their share of the levy from 23 March.
They will have 30 days to pay the invoice or can use existing credit facilities to spread the costs of the levy.
Mark Neale, FSCS chief executive, said: "FSCS is there for consumers when authorised firms go bust. It has a duty to pay compensation claims as they fall due and that helps to promote consumer confidence. The costs of SIPPs claims are rising so we have no choice but to issue this levy to the firms that pay for FSCS protection. This interim levy will cover the costs of compensation claims until the next annual levy is available in July 2015.
"In January this year we advised the industry that the volume of claims could increase. We also indicated the forecast compensation costs could materially increase if FSCS compensated for investment losses. This is now the case.
"I know this will be unwelcome news for firms facing a supplementary levy. We will continue to do all we can to provide more certainty for firms but we cannot entirely eliminate volatility in what is a pay-as-you-go funding arrangement."
FSCS will announce the 2015/16 annual levy in April.