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04-11-2020

UK home insurance claim statistics

This article was updated on August 25 2021.

Home insurance provides essential cover for homeowners throughout the UK. There are effectively three types of home insurance policies: buildings insurance, contents insurance, and buildings & contents insurance as a combined policy. 

For many homeowners, buildings and contents insurance exists merely as a safety net, often never used at all. In fact, since 2010 the number of property insurance claims notified in the UK has seen a consistent year-on-year decrease. In 2017 there were 1.23 million home insurance claims made in the UK, compared with 2.96 million in 2010 (a 147% drop).

The following home insurance claim statistics have been compiled to shed further light on the UK home insurance market.

Buildings and contents insurance average cost

As of Q1 2021, the average price of a combined buildings and contents policy in the UK is £141.

Insurers pay out £8m per day for home insurance claims

Insurers process the equivalent of £16m per day in property claims, of which £8m was for household claims and £8m for commercial claims. 

The acceptance rate for home insurance claims is 82%

During the 2018/19 period, 82% of the total number of home insurance claims made were accepted, a slight decrease over the previous period.

Since 2018, there have been two insurers with a claims acceptance rate of approximately 99%. The five home insurance companies with the highest claims acceptance rates in the UK in 2019 were:

  • Gresham Insurance: Claims acceptance rate of 98.75%
  • UK Insurance Ltd: Claims acceptance rate of 98.75%
  • AmTrust Europe: Claims acceptance rate of 96.2%
  • Zurich: Claims acceptance rate of 96.2%
  • Aviva: Claims acceptance rate of 96.2%

Most common home insurance claims

Escape of water is the leading cause of home insurance claims in the UK, accounting for 29% of all domestic claims. 

This is followed by fires & explosions (accounting for 17% of claims) and theft (14%).

  • Escape of water 29%
  • Fire & explosion 17%
  • Theft 14%
  • Domestic subsidence 6%
  • Other domestic claims 13%
  • Accidental damage 11%
  • Weather 11%

Home insurance costs increase by up to 29% after making a claim

Data collected by Insurance.com, a US insurance comparison site, shows that the average cost of home insurance increases significantly after making a claim. 

For fire insurance claims specifically, the average percentage increase is 29% for a single claim and 60% for two claims. 

Insurers pay out £1.8m for escape of water claims every day

Escape of water isn’t only the leading cause of home insurance claims, it’s also one of the most expensive. According to ABI (The Association of British Insurers), insurers pay out £1.8m for escape of water claims every day.

A quarter of escape of water insurance claims are caused by neighbouring properties

Research from Direct Line Home Insurance suggests seven home insurance claims are made every day due to water damage caused by leaks from neighbours’ properties. This accounts for almost a quarter (23%) of all home insurance claims for escape of water in flats since 2018.

The financial impact of water leaking from or into a neighbouring property is significant, with the damage estimated at £2.8m per year.

Making a flood claim could double the cost of your home insurance

Data from MoneySuperMarket shows that consumers whose home has been flooded pay an average of £199 per year for a home insurance policy, compared with £96 a year for those who haven’t made flood insurance claims.

More than 6,000 complaints to Financial Ombudsman in 2019/20

The Financial Ombudsman dealt with 6,160 new cases relating to buildings and contents insurance policies in 2019/20.

Buildings insurance specifically accounted for 75% (4,601) of these cases. 

Compared with the previous year, buildings and contents insurance cases fell by approx 40%.

38% of buildings insurance complaints and 28% of contents insurance complaints were upheld in favour of the customer.

The lowest average insurance claim pay-out by an insurer is £1,250

The home insurance companies with the lowest average insurance claim pay-out in the UK in 2019 were:

  • Cornish Mutual: £1,250 per pay-out
  • UK insurance Ltd: £2,250 per pay-out
  • Ageas Insurance: £2,750 per pay-out
  • Axis / Novae: £2,750 per pay-out
  • Legal and General: £2,750 per pay-out

The highest average insurance claim pay-out by an insurer is £11,250

The home insurance companies with the lowest average insurance claim pay-out in the UK in 2019 were:

  • Hiscox: £11,250 per pay-out
  • St Andrews Group: £9,250 per pay-out
  • Ecclesiastical Insurance: £6,250 per pay-out
  • Canopius: £6,250 per pay-out
  • CIS: £5,250 per pay-out

How long do home insurance claims take?

A home insurance claim may take days or years, depending on many factors including the insurer and the complexity of the claim. For a more detailed explanation, watch our How long does an insurance claim take? explainer video.

Sources:

  • www.abi.org.uk
  • www.statista.com
  • www.directlinegroup.co.uk
  • www.moneysupermarket.com
  • www.financial-ombudsman.org.uk
  • www.insurance.com

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