The latest figures have prompted renewed calls from the ABI for the Government to commit to adequate, long-term investment in flood defences within its upcoming Spending Review and publication of the 10 Year Infrastructure Strategy. These record payouts follow significant and consistent bad weather, including Storm Eowyn – which the Met Office described as the UK’s most powerful windstorm for over a decade. The latest claims data from the ABI also reveals that in the first three months of 2025:
Claims for damage to homes from adverse weather totalled £226 million, £80 million (55%) more than the weather-related claims payouts in the previous quarter. A record £886 million was paid out in total for domestic property claims, up £145 million (20%) on Q1 2024. This includes damage for other perils such as fire, theft and subsidence.
Bad weather wasn’t just a problem for homeowners, as ABI members paid out £109 million to businesses for weather-related damage and business interruption. This is an increase of £7 million (7%) on Q1 2024. The total cost of property claims for domestic and commercial buildings in Q1 2025 was £1.5 billion, up £170 million (13%) on Q1 2024. With bad weather continuing to take a toll on homeowners and businesses, the ABI has stressed the importance of adequate annual investment in flood defences.
Louise Clark, Manager of General Insurance Policy at the ABI, said: “Insurance remains a critical safety net when disaster strikes. But with climate change driving more frequent and severe weather, there must be a greater focus on prevention measures. Adequate and sustained investment in flood defences is crucial, and we urge the Government to commit to an investment of at least £1 billion a year as part of its upcoming Spending Review. We also want to see swift action to combat surface water flooding, and a clear strategy to build climate-resilient homes in safe, flood-free areas as part of the Planning and Infrastructure Bill. Such forward-thinking measures will not only deliver substantial financial savings in the long-term but also mitigate the emotional strain that extreme weather events inflict on households.”
Property insurance premiums
The annual average price of combined building and contents home insurance in Q1 2025 was £393. Despite this being £1 lower than the previous quarter, it is £24 (7%) more compared to Q1 2024 as high claim costs continue to have an impact. The average price of buildings-only insurance was also down £1 on the previous quarter to £322. However, it is £28 (10%) higher compared to Q1 2024. The average price of contents-only insurance in Q1 2025 dropped £8 (6%) to £128 compared to Q4 2024. It is also £2 lower than prices paid in Q1 2024.
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