Escape of water claims are consistently the most expensive claim for insurers and they are increasing in cost and volume. According to figures from the Association of British Insurers, domestic escape of water claims cost £483m in the first nine months of 2017 whilst between 2014 and 2016 the total cost of domestic escape of water claims jumped by 24% from £529m to £654m. The average cost of these claims has risen by 31% over the same period. As a percentage of the gross value of all UK domestic property claims, escape of water claims constituted 26% of all claims in 2015 with that figure rising to 28% in 2016.

The ABI has called on insurers to prioritise reversing the rising cost of escape of water claims in 2018.

Anecdotally, IFIC Forensics sees a 1 in 8 fraud opportunity and a 1 in 3 recovery opportunity on escape of water claims for which it receives instruction. Investigation by IFIC Forensics delivers clients accurately determined causation and origin for escape of water claims. This enables genuine claims to be progressed promptly and appropriately, fraudulent claims to be identified and repudiated and any third party liability to be established with the associated recovery opportunities.

Escape of water can result from a multitude of causes including:

  • Poor installation and workmanship
  • Production and manufacturing defects
  • Poor component design
  • Pressure fluctuations and water hammer
  • Physical or mechanical damage
  • Deliberate physical or mechanical damage
  • Weather dependent temperature fluctuations such as the thawing of frozen pipework
  • Gradual deterioration over time including the effects of corrosion

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