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August Sees Record Subsidence Claims
5 Sep
Summary
- Insurers report a significant rise in subsidence claims this August.
- Hotter, drier summers increase property risk due to ground shrinkage.
- Average subsidence claim cost has risen to a record £20,000.
Insurers across England and Wales are experiencing a significant uptick in subsidence claims following the record-breaking hot summer and multiple heatwaves. Hastings Direct reported an all-time high for August, with a near 140% increase in claims compared to the previous year.
The British Geological Survey warns that millions of homes are at risk from subsidence as climate change leads to more frequent hotter, drier summers. This phenomenon causes the ground beneath properties to shrink, potentially affecting foundations, with older homes being more vulnerable.
Several insurers, including Aviva and Axa, have noted increased subsidence claims. The average cost of a subsidence claim between April and June reached a record £20,000, a substantial increase from the prior year. Insurers paid out £72 million for domestic subsidence claims during this period.
This trend is expected to persist into the autumn, even as temperatures normalize and rainfall occurs. Insurers are reviewing reserves and pricing models to account for the rising costs and frequency of weather-related property damage.
