The average cost of a UK home insurance policy has surged by nearly 20%, reaching just under £400, as insurers respond to unprecedented weather-related claims from 2023.

New data from the Association of British Insurers (ABI) shows that annual home insurance premiums, covering both buildings and contents, averaged £396 between May and June. This represents a 6% increase from the previous quarter and a 19% rise compared to the same period last year.

The spike in premiums comes as insurers grapple with escalating costs, driven by a combination of inflation in rebuild expenses and more severe weather events, exacerbated by climate change. The ABI reported that insurers paid out £1.4 billion in claims to UK homeowners and businesses between April and June – a record quarterly amount since data collection began in 2017.

In 2023, UK insurers faced a record £573 million in weather-related payouts following a series of storms. 

Louise Clark, a policy adviser at the ABI, highlighted the “devastating impact” of adverse weather on homeowners and reiterated the need for government action to address surface water flooding and maintain flood prevention investments.

For the fifth consecutive quarter, weather-related claims, including those for storm damage, heavy rain, and frozen pipes, exceeded £100m. Subsidence claims also hit a quarterly record.

While the £396 average premium represents an all-time high in nominal terms, the ABI noted that when adjusted for inflation, it remains below the levels seen in 2017.