New figures from the ABI’s latest Property Insurance Tracker show home insurers paid out £72 million for domestic subsidence claims during the second quarter of 2026, with the average subsidence claim reaching a record £20,000.

The average payout is more than £2,000 higher than in the same period last year, highlighting both the growing cost of subsidence and the vital protection insurance provides for homeowners. 

The figures follow the warmest spring on record in England and Wales, and the third warmest across the UK, with prolonged dry weather increasing the risk of ground movement and damage to properties.¹ 

Advice for homeowners

Subsidence occurs when the ground beneath a property sinks, causing the building’s foundations to move. It is most commonly caused by soil losing moisture and shrinking, often during prolonged dry weather. Trees and large shrubs can also contribute by drawing water from the ground.

Homeowners concerned about subsidence should be aware of several warning signs: 

• Subsidence-related cracks often appear suddenly, rather than developing gradually through normal wear and tear.
• Keep an eye out for cracks that are wider than 3mm – about the thickness of a £1 coin – as these may need further investigation.
• Be particularly aware of diagonal cracks, especially if they are wider at the top than at the bottom.
• Check whether cracks appear both inside and outside your home, as this can be a sign of a more serious issue.
• Watch for doors and windows that suddenly become difficult to open or close.
• Look out for wallpaper that starts to wrinkle, ripple or tear without an obvious cause.
• If you're concerned about possible subsidence, seek professional advice and contact your insurer.

Average home insurance payout reaches new high 

Between April and June 2026, the average payout across all types of home insurance claims went above £7,000 for the first time – having only broken the £6,000 mark in the same period last year.

The cost of damage caused by extreme weather continued to rise. The average claim for damage to people’s homes and possessions from flooding, storms and burst pipes reached £8,548 in the second quarter of 2026, up 12% on the same period in 2025.

The average claim for theft also reached a record £5,100 this quarter, up 27% year-on-year.

The growing cost of subsidence and weather-related damage is a reminder of why improving the resilience of our homes matters. While insurers continue to be there for customers when they need them most – providing financial protection and support – reducing future losses demands a coordinated effort from homeowners, industry and government. 

Simple steps can make a real difference. For new homes, building deep foundations can reduce the risk of subsidence. For older properties, maintaining nearby trees and drains and fixing leaking pipes can prevent problems from developing. As extreme weather becomes more common, protecting homes will be increasingly important to help communities better withstand its impacts.

Chris Bose

Director of General Insurance Policy at the ABI

Household property premiums

The average combined home insurance premium was £383 between April and June 2026, 2% (£9) lower than a year earlier. While premiums increased by £8 compared to the previous quarter, this was the first quarterly rise since the start of 2025.

The average buildings-only premium was £309, 5% (£16) lower than a year earlier, and up £4 compared to Q1 2026.

Contents-only policies averaged £118, down 9% (£11) year-on-year, while increasing by £1 compared to the previous quarter.