Group expects rise in subsidence-related insurance claims this summer

A rise in subsidence-related insurance claims could be on the horizon this summer, as dry and warm conditions across the UK resemble those that preceded one of the most expensive surge events in recent years, according to Claims Consortium Group.

New analysis from weather data provider WeatherNet, published in late June, indicated that soil moisture levels are nearing thresholds associated with higher subsidence risk. If current conditions persist, insurers may face a repeat of 2022, when around 18,000 of 23,000 total subsidence claims were made following a prolonged summer heatwave. The surge cost the industry an estimated £219 million.

Subsidence is one of the costliest domestic insurance perils in the UK. The Association of British Insurers reported £54 million in subsidence claims in Q2 2023 and £66 million in Q3, with longer-term estimates from PwC suggesting total subsidence costs could reach £1.9 billion by 2030.

“We are at a tipping point,” said Steven Coxon (pictured above), head of subsidence claims at Claims Consortium Group. “While the ground hasn’t yet dried to a critical level, the outlook is for dry weather to continue, making a surge more likely.”

Soil Moisture Deficit (SMD) values have reached near 250 by week 24 of 2025, around two to three weeks earlier than in 2022. Spring 2025 was recorded as the warmest in UK history and among the driest in the past 50 years.

Claims Consortium Group said it has activated its internal surge planning measures. These include expanded capacity across supply chains, contractor networks and cross-trained claims handlers to manage potential increases in volume.

“Our surge plan will be deployed the moment new claim volumes cross certain thresholds,” Coxon said, noting that the company maintained a 70% repudiation rate in previous surge years — above the industry average of 55 to 60% — due in part to its front-end triage processes.

If a subsidence surge occurs in 2025, it would be the third such event in seven years, following surges in 2018 and 2022. Insurers are expected to remain on high alert throughout the remainder of the summer, particularly in high-risk regions such as London, the South East, and parts of the Midlands, according to Claims Consortium Group.