Although the risks associated with subsidence are relatively well known, property damage can also occur when there is upward movement of the ground supporting a building. This is known as heave. Both subsidence and heave are usually covered by your standard building’s insurance policy.
How big a problem is it?
Awareness of the risks associated with subsidence have increased in recent years, but many people do not appreciate how great the risk is.
- Over the last 10 years, subsidence has cost the UK economy an estimated £3bn; making it the most damaging geohazard in Britain today.
- As many as one in five homes in England and Wales may be at risk of damage resulting from ground that swells when it gets wet and shrinks as it dries out.
- Subsidence affects as many properties in the UK on an annual basis as flooding.
- We have seen a 50% increase in subsidence damage, compared to the period between 1950 and 1970. Researchers predict a further 50% increase between now and 2040.
- The Environment Agency predicts climate changes with increased flood & drought with a drought equivalent to 1976 occurring every 10 years.
- The British Geological Survey (BGS) research on behalf of the Lloyds of London insurance market predicts a 29-34% increase in subsidence in next 10yrs in the UK. This increase will be greatest in areas under the London Clay formation (above which sits the UK’s largest population!)
- If a property has had a subsidence insurance claim, or has suffered from subsidence in the past, it must be declared when the property is sold. This may affect a buyer’s ability to secure a mortgage on the property.
If you are looking to purchase a property, we recommend you ask your conveyancer or solicitor includes a subsidence risk assessment in their searches. The good news is that, unlike other geohazards, there are some relatively easy and cost-effective steps you can take to help reduce the risk of subsidence.