New research maps where flood, shrink-swell and coastal erosion risk are concentrating, and the outlook is worsening in all three
Domestic subsidence payouts hit £307 million in 2025, the highest level on the Association of British Insurers’ records, driven by the UK’s hottest and driest spring on record and a summer that compounded the ground-drying effect on clay soils. Weather-related property claims overall reached £1.2 billion, up 14% on 2024, within a total UK property claims bill of £6.1 billion for the year.
Those headline figures provide context for new research and modelling from the British Geological Survey and the Environment Agency that maps where each of the UK’s three main property hazards, shrink-swell subsidence, flooding and coastal erosion, is most concentrated, and where each is heading.
Subsidence: concentrated in London and the South East, and worsening
BGS research published in 2026 confirms that shrink-swell subsidence risk, where clay soils expand and contract as moisture levels change, is heavily concentrated in specific parts of England, particularly London’s northern and central boroughs, including Camden, Islington and Barnet, alongside Kent.
The projections are material. Under a medium emissions scenario, BGS finds that more than a quarter of London properties will be highly or extremely likely to be affected by shrink-swell subsidence by 2070. Under a higher emissions scenario, that rises to more than half. More than 2.5 million properties in the capital already fall into the higher-risk category today.
That risk is already showing up in claims beyond the ABI’s national figures. London subsidence claims reached a fresh record last quarter following the region’s fifth successive heatwave, with average household claims reaching £20,000, a 15% increase on the same period in 2025.
The ABI’s own data shows storm damage to homes reached £244 million in 2025, up 32% on the prior year, with the average storm payout rising to £2,450. Average homeowner flood payouts surged 60% to £30,000, even as the average combined buildings and contents policy fell £14 year on year to £379 in the final quarter of 2025.
Flood: surface water now the single biggest driver
The Environment Agency’s updated national flood risk assessment, which uses more precise climate modelling than previous versions, puts 6.3 million homes and businesses in England in areas at risk of flooding from rivers, the sea or surface water. That figure is expected to rise to around eight million by the middle of the century.
The updated assessment identifies the single biggest driver of that risk as neither rivers nor the coast, but sudden surface water flooding caused by intense summer downpours, exactly the kind of localised, hard-to-predict event that has become more frequent as the climate warms. For brokers and underwriters pricing flood risk by postcode, the shift in the dominant peril source is a material change in how that risk needs to be assessed.
Coastal erosion: from modelling to practice
Parts of the East Riding of Yorkshire coastline, including Holderness, erode at average rates of several metres a year, among the fastest recorded anywhere in northwest Europe. Individual cliff-loss events in undefended locations can run to 20 metres or more. For properties close to the cliff edge, the risk is not water damage to an intact structure but the gradual loss of the land beneath it.
North Norfolk presents the same risk in a form that has already moved beyond modelling into action. Updated coastal projections now allow erosion risk assessments out to 2055 and 2105. In April, North Norfolk District Council confirmed that three properties and a former office building in Happisburgh were demolished in response to coastal erosion, a concrete illustration of the risk that insurers and brokers writing coastal properties have been tracking through model outputs.
Why postcode-level detail matters, and where it falls short
None of these hazards is evenly distributed even within a single street. BGS’s own subsidence modelling factors in local geology, nearby tree cover, building age, drainage and number of storeys, meaning two neighbouring properties can carry meaningfully different risk profiles depending on their specific construction and position.
That granularity cuts two ways for the insurance sector. Better data means underwriters can price and manage these risks with more precision than a decade ago. But the same improving data also makes it harder to treat any of these hazards as a rare or one-off event. Flood, subsidence and coastal erosion are each becoming both more severe and more precisely mapped simultaneously, a combination that will keep working its way through premiums, policy availability and long-term underwriting strategy for years ahead.