Hot weather over the summer increases subsidence claims

Subsidence is the downward movement of ground beneath a property which leads to abnormal stress on the structure and foundations, which can result in cracking and property damage.

Subsidence typically arises following:

• The removal of underground water
• The reduction of soil compaction
• The drainage of organic material within the soil

Property is at an increased risk following extended hot weather and dry spells. Contributory factors include vegetation, extensions built to inadequate standards and water leaking into foundations from leaking or collapsed drains.

Zurich’s experience does show that just because a property sits in a high-risk area (such as the South East of England), subsidence will not necessarily manifest. On clay soils a property may settle, but the pattern can be uniform and even across its footprint and not lead to any damage.

Market Commentary

The ABI has recently published commentary on the topic, following the UK’s hot weather over the summer. They report that the number of claims across the industry jumped from 2,500 in Q2 to 10,000 in Q3 – with subsequent pay-outs rising in value from £14 million to £64 million. This increase in volume is the highest quarter-on-quarter jump since records began more than 25 years ago.

Previous subsidence surge years, for the industry as well as Zurich, were 2003 and 2006. These followed record-breaking heat waves through the UK with volumes reaching 50,000. In contrast, last year there were 12,000 new claims notified, which is the lowest recorded since ABI started collecting data.

Areas affected

Many regions within the UK experienced some of the driest and hottest months on record over the summer. A particularly prevalent region, which is well-known for subsidence-prone clay soil, was the South East. Zurich has additionally received increased notifications from customers in the South West and Midlands, parts of the North West and North East.

Loss Adjuster publications

Zurich partner with specialist subsidence Loss Adjusters in the UK, who have been issuing regular bulletins, conference calls and data on subsidence since the summer. Zurich have been actively monitoring and participating in this activity, whilst listening to our customers and reviewing our data.

Sedgwick predicted a surge in claims in August and have subsequently documented a rise in volumes between 350-400%. Notifications peaked in mid-September and, whilst roughly half, volumes remain 250% above plan by mid-November.

Crawford have reported a 300% increase compared to the first half of 2018 and 400% compared to 2017. Whilst repudiations (no policy cover) on the quarter are down, from 65% to 30%, this is normal as investigations progress.

Subsidence claims

Costs associated with subsidence can be categorised into prevention, investigation, mitigation and repair. Over the last decade, there has been vast improvements in the management and effectiveness of each category. This has largely been enabled by technology advancements and engineering innovations.

As a result Zurich, our Loss Adjusters and, supply chain, will deploy the following solutions to manage our customers’ subsidence claims:

• Prevention – tracking soil conditions, level monitoring readings and long-term weather forecasts that provide a suite of predictive analytics
• Investigation – identifying the cause of the problem, analysing soil conditions, establishing depth of foundations, reviewing historical and geological maps
• Mitigation – live remote crack monitoring, video streaming, geo-mapping and data analytics
• Repair – modern techniques including screw piling, injection grouting and rehydrating

This is in addition to more traditional repairs such as underpinning, targeted lifting (jacking) and tree removal. Of course, there is no substitute for skilled adjuster surveyors with a detailed knowledge of subsidence claims. This is particularly important in the interpretation of data pertaining to soil plasticity etc..

Quickly identifying and arresting the cause of the subsidence movement is critical. These steps are integral to our claims solution which enables quicker, more efficient and effective resolution of claims that are unique to each event.

Advice for customers

The first sign of subsidence is the appearance of cracks in a properties brick or plasterwork. In general, subsidence cracks develop abruptly and exhibit different characterises to other cracks. They are usually diagonal, tapered and present both inside and outside a property.

To determine whether your property is subsiding, we recommend the ABI’s advice that subsidence cracks typically are:

• diagonal, and wider at the top than at the bottom
• thicker than a 10 pence coin
• found around doors and windows

Subsidence may also cause doors and windows to stick as the building’s structure becomes distorted.

It is important to note that cracking can occur in a property for reasons unrelated to subsidence. These include the natural settlement of soil under new homes/extensions, thermal and humidity expansions or the drying and shrinkage of building materials (including freshly plastered walls).

How to avoid subsidence

• Plant new trees and shrubs at a ‘safe distance’ from your property – review safe distance and tree hazard guidance
• For trees older than the property and within a safe distance, conduct regular pruning to control amount of water used in foliage growth
• Do not remove trees older than the property and within a safe distance, this may cause heave or uplift
• Drains and pipes should be checked regularly to ensure there are no blockages or leaks
• Conduct regular general maintenance including fixing leaking drains, clearing debris from gutters and pruning trees and shrubs

5-step guide if you observe a crack

1. Do not panic! Cracking can occur in a property for reasons unrelated to subsidence
2. Compare the crack’s characteristics with the ABI’s advice given above
3. Locate the trees and shrubs around your property that may be relevant. If you suspect a tree belonging to a neighbour or the council, make contact and determine appropriate way forward
4. Review your properties drains, pipes and gutters to identify and remediate blockages or leaks. Never remove trees which are older than your property or subject to a preservation order
5. If you are unsure, please contact a subsidence specialist or your usual Zurich contact who will be happy to provide help and instruction

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