UK home, business property insurance payouts hit $6 bln in 2023

 – Britain’s homes and businesses received 4.86 billion pounds ($6.07 billion) in property insurance payouts in 2023, up 18% from a year earlier, as weather-related home claims hit a record high, the Association of British Insurers said on Monday.

Weather-related home damage claims rose 36% to 573 million pounds, with homes battered by a succession of storms last autumn, the ABI said in a statement. High winds, storm debris, flooding and burst pipes contributed to the losses, it added.

Insurance companies worldwide are facing higher claims from natural catastrophes, industry sources say, which they attribute to the effects of climate change and to a rise in building in areas exposed to extreme weather.

Insurers are facing more storm losses than in the past in Britain and other parts of Europe, they add, with inflation and supply chain issues contributing to an increase in the cost of repairs, and therefore to the size of payouts.

Winter storms in northwestern Europe in early 2023 led to insured losses of more than $4 billion, above the previous 10-year average of $2.5 billion, according to Swiss Re.

“We continue to press the government for further investment in flood defense and maintenance, as well as calling for changes to the planning system to discourage building where flooding might be more likely,” ABI policy adviser Louise Clark said.

The average UK home insurance premium rose 13% year on year in the fourth quarter of 2023, recent data from the ABI showed.

Britain’s insurer-funded Flood Re reinsurance program helps insurers make home insurance more affordable. But it is not available for homes built after January 2009.  – Reuters