Association of British Insurers (ABI) members received a record 13,000 new domestic subsidence claims between July and September this year, following the summer heatwaves. In the same period a year earlier, 8,000 subsidence claims were received.
Record Payouts and Rising Costs
The average insurance payout for subsidence damage to a home remained at a record £20,000 for the second quarter in a row. Meanwhile, the average home and business property insurance payout reached a record £10,000 for claims in the third quarter of this year, according to the ABI.
While the total number of home and business claims fell by 4% to 142,000 compared with the previous quarter, the amount paid out by insurers increased by 1% to £1.5 billion. The increase reflects rising repair costs across the supply chain, including higher prices of materials and labour, as well as more severe weather causing more significant damage to properties, the ABI said.
Warning Signs for Homeowners
The ABI said that homeowners concerned about subsidence should be aware of several warning signs, and may need to consider speaking to their insurer and seeking professional advice if they notice cracks that are wider than 3mm – about the thickness of a £1 coin – as these may need further investigation. Diagonal cracks, particularly if they are wider at the top than at the bottom, and cracks that appear suddenly, rather than developing gradually through normal wear and tear, are also warning signs.
Weather Impact and Resilience Call
The ABI said the average domestic fire claim amounted to £38,000 and the average domestic flood claim cost £28,000. The average annual home insurance premium for the third quarter of 2026 was £329, which was the same as a year earlier, although a rise of £4 from the second quarter of this year.
Chris Bose, director of general insurance and international policy at the ABI, said: "This year's weather has painted a clear picture of what's to come, with heatwaves and storms hitting communities right across the UK. Insurers stand ready to help people repair and rebuild, but more action is needed to prevent damage in the first place. These record costs show the severe damage that extreme weather is now causing for communities and the need to boost resilience. It's vital that new homes are built to withstand increasingly frequent extreme weather and that we work together to improve the long-term resilience of our homes and businesses."
