The Association of British Insurers (ABI), the trade body representing the UK’s insurance and long-term savings industry, has revealed that insurance claims related to extreme weather have reached a record high in the first quarter of 2025 — intensifying calls for stronger government investment in flood defence infrastructure.
According to the ABI’s latest data, weather-related claims for damage to homes and belongings totalled £226 million between January and April 2025.
This is the highest quarterly payout on record and exceeds the previous peak from Q1 2022 by £67 million.
The figures reflect the impact of prolonged adverse weather, most notably Storm Eowyn, which the Met Office described as the UK’s most powerful windstorm in over a decade.
In response to the escalating costs, the ABI is urging the government to commit to long-term, sustainable funding for flood defences in the forthcoming Spending Review and 10-Year Infrastructure Strategy. The association stresses that strategic investment is critical to help communities withstand worsening climate-related risks.
The ABI’s report also showed that overall payouts for domestic property claims — including weather damage, fire, theft, and subsidence — reached £886 million in Q1 2025. This marks a 20% increase (£145 million) compared to the same period in 2024.
Businesses have also been significantly affected. The ABI reported that insurers paid out £109 million to businesses for weather-related damage and business interruption — a year-on-year rise of 7%.
Combined, domestic and commercial property claims reached £1.5 billion in the first quarter of 2025, up £170 million (13%) from Q1 2024, according to ABI figures.
In total, insurers paid out £886 million in domestic property claims in Q1 2025, reflecting a £145 million (20%) increase on the same period last year. This figure includes a range of claims — from weather-related incidents to fire, theft, and subsidence.
Commercial properties were also hit hard. According to the ABI’s figures, insurers paid out £109 million in claims to businesses affected by storm damage and disruption, a £7 million (7%) rise from Q1 2024. Altogether, domestic and commercial property claims reached £1.5 billion in the first quarter of the year — up £170 million (13%) from the same period last year.
Rising claims are also influencing home insurance pricing. In Q1 2025, the average combined buildings and contents home insurance policy stood at £393. Although this is £1 less than in the previous quarter, it represents a £24 increase (7%) compared to Q1 2024 — a reflection of elevated claim costs across the sector.
Buildings-only policies averaged £322 in Q1 2025, down £1 from Q4 2024, but up £28 (10%) year-on-year. In contrast, contents-only cover saw a sharper quarter-on-quarter drop, falling £8 (6%) to £128 — also £2 less than the average price in Q1 2024.
As extreme weather patterns persist and drive both higher claims and rising premiums, the ABI continues to stress the urgent need for long-term, predictable investment in the UK’s flood and weather resilience infrastructure to reduce future financial and social impact.
Louise Clark, Manager of General Insurance Policy at the ABI, added: “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.”
