Does House Insurance Cover Subsidence?

You’ve discovered subsidence or suspected subsidence symptoms. Your first thought: “Will insurance pay for this?” The answer isn’t straightforward. Most policies cover subsidence, but exclusions, excesses, and policy conditions create complexity that catches homeowners unaware.

Understanding exactly what your policy covers before you need to claim prevents nasty surprises when structural problems develop.

What Standard Policies Cover

Buildings insurance typically includes subsidence coverage. Standard policies protect against ground movement causing structural damage. This covers foundation repairs, underpinning, and associated structural work needed to stabilise your property.

Subsidence clauses cover damage caused by downward movement. Landslip (sideways movement) and heave (upward movement) also get covered under the same policy sections. These three ground movement types receive similar treatment.

Alternative accommodation costs are included during major repairs. If underpinning requires moving out, insurers pay temporary rental costs. Policy limits vary, typically capping payments at £25,000-50,000 or 12 months duration.

Emergency repairs to prevent further damage receive coverage. If walls need temporary shoring whilst awaiting full repairs, insurers authorise this work. Quick action prevents minor problems becoming catastrophic.

Common Exclusions

Newly built properties under 10 years old often excluded. Insurers argue structural warranties from builders (NHBC) should cover defects during this period. Check policy wording carefully on new builds.

Pre-existing damage known before you bought the property gets excluded. You can’t purchase insurance then immediately claim for problems you knew existed. This exclusion prevents fraud but complicates purchases of affected properties.

Coastal erosion falls outside subsidence coverage. Properties losing land to sea erosion need separate coverage. Standard subsidence policies specifically exclude coastal and riverbank erosion.

Mining subsidence has separate compensation schemes. The Coal Authority handles claims for damage from past coal mining. Insurance policies exclude this because statutory compensation exists.

Normal settling of new buildings isn’t covered. Minor cracking during the first few years as properties settle doesn’t trigger subsidence clauses. This represents expected behaviour rather than insured risk.

The Dreaded Excess

Subsidence excesses are much higher than standard policy excesses. Whilst general building claims might have £250 excess, subsidence excesses typically range from £1,000-2,500. This applies per claim regardless of total damage costs.

Percentage-based excesses affect some policies. Instead of fixed amounts, excess equals a percentage of claim value. A 10% excess on a £40,000 claim means you pay £4,000. These percentage excesses often have minimum amounts around £1,000.

Excess applies even if insurers appoint contractors. You might think using insurer’s contractors means they pay everything. Wrong. They still deduct excess from your final settlement or require upfront payment.

Reducing excesses increases premiums significantly. Buying down from £2,500 to £1,000 excess might cost an extra £100-200 annually. Over 10 years, you pay £1,000-2,000 in premiums to save £1,500 excess. The maths rarely favours lower excesses.

The Claims Process

Report potential subsidence immediately. Most policies require prompt notification. Delays can jeopardise coverage. Contact your insurer as soon as you suspect subsidence, even before confirming the diagnosis.

Insurers appoint loss adjusters to assess claims. These representatives investigate whether damage qualifies as subsidence. They determine if policy coverage applies before authorising expensive investigations.

Structural engineers investigate on insurers’ behalf. Insurers instruct their own engineers, not yours. These engineers report findings to insurers who decide whether to accept claims based on engineering evidence.

Monitoring periods frustrate homeowners. Insurers often require 6-12 months of monitoring before authorising repairs. They want confirmation that movement has stabilised or understanding of ongoing rates. This delay feels unreasonable but reflects sound engineering practice.

Repair specifications come from insurer’s engineers. You have limited input into repair methods. Insurers choose the most cost-effective appropriate solution. Your preference for specific repair methods might not influence decisions.

When Insurers Reject Claims

Tree root subsidence sometimes gets rejected. If mature trees existed when you purchased the property, insurers might argue you accepted this risk. They claim the subsidence was foreseeable and therefore not covered.

Lack of maintenance provides rejection grounds. If leaking drains caused subsidence and you’d neglected drain maintenance, insurers might refuse coverage. Policies exclude damage from lack of maintenance.

Betterment reduces settlements. If repairs improve your property beyond original condition, insurers pay only for restoring to original standards. Upgrading to modern foundations during repairs means you cover upgrade costs.

Policy wording interpretation causes disputes. Ambiguous terms get interpreted in insurers’ favour. “Sudden subsidence” clauses exclude gradual movement developing over years. These subtle wordings catch policyholders unaware.

Impact on Future Insurance

Premiums increase dramatically after claims. Subsidence claims mark properties as high risk. Expect premiums to rise 20-50% for several years. Some insurers increase rates for up to 10 years post-claim.

Switching insurers becomes difficult. Most companies check claims databases during underwriting. Your subsidence claim follows you. New insurers either refuse coverage or quote premiums matching your current insurer.

Subsidence exclusions might apply going forward. After one claim, insurers might continue covering your property but exclude future subsidence claims. You get general buildings insurance but lose the subsidence protection you need most.

Selling affected properties requires disclosure. Buyers’ solicitors ask about subsidence history. Your past claim must be revealed. This disclosure affects saleability and reduces offers from cautious buyers.

Claiming Tips

Document everything thoroughly. Photograph cracks from multiple angles with rulers showing scale. Date all images. Keep written records of when damage appeared and how it progressed.

Get multiple professional opinions. Commission your own structural engineer’s report before insurers investigate. This provides leverage if you disagree with insurer’s engineers. Independent evidence strengthens your position.

Challenge unreasonable delays or decisions. Insurers sometimes unreasonably extend monitoring periods or minimise damage severity. Politely but firmly question decisions that seem unjustified. Escalate through complaints procedures if needed.

Consider public loss assessors for complex claims. These professionals work for you, not insurers. They charge 5-10% of settlement values but often secure significantly higher payouts. For large claims, they’re worth considering.

Alternatives to Insurance

Self-funding repairs gives complete control. You choose contractors, repair methods, and timing. No excess payments, no premium increases, no claims history. But you bear full costs upfront.

Some specialist insurers offer post-subsidence cover. After suffering subsidence and being unable to renew standard policies, specialist insurers provide coverage at premium rates. Expect to pay 2-3 times standard premiums.

Structural warranties provide alternative protection. Some companies offer warranties specifically covering ground movement. These policies fill gaps when standard insurers exclude subsidence. Coverage costs £300-500 annually typically.

Buying Properties with Subsidence History

Existing insurance might be transferable. Sellers with valid subsidence cover can sometimes transfer policies. Check with their insurer about continuity of cover for new owners.

Specialists in subsidence-affected properties exist. Certain insurers target this market niche. They assess properties individually rather than applying blanket exclusions. Shop around extensively.

Lenders might restrict mortgages. Properties with subsidence history face lending challenges. Some lenders refuse mortgages entirely. Others lend at higher rates or lower loan-to-value ratios.

Survey carefully before buying. Commission building surveys specifically investigating past subsidence. Ensure repairs were completed properly and movement has ceased. The discount you negotiate should reflect ongoing insurance challenges.

Policy Comparison Checklist

Check subsidence excess amounts. Compare fixed versus percentage-based excesses. Factor these into total potential costs.

Verify alternative accommodation limits. Check both monetary caps and time restrictions. Ensure coverage matches likely needs based on property size.

Read exclusion clauses carefully. Note specific exclusions around trees, drains, or property age. These determine whether likely claim scenarios receive coverage.

Confirm claim authorisation processes. Understand requirements for monitoring, multiple opinions, or repair method restrictions. Some policies offer more flexibility than others.

Ask about post-claim premium increases. Some insurers commit to capping increases or reviewing rates after specific periods. These commitments prove valuable after claims.