Fees on the rise as houses subside

THE WET August will make no difference at all to the deluge of subsidence claims flooding in to insurance companies. A spokesman for the Association of British Insurers said: 'It is all welcome, but there is still a long way to go. The meteorologists reckon we need a lot more rain before the clay stops searching for water and cracking.'

Too much water, however, is also bad news. If we go on having rain-sodden summers, rather than balanced weather, 'heave' will occur, where the clay takes in the moisture and expands, causing as much trouble as it does when it is too dry.

In 1991, insurers paid out a record pounds 540m, a rise of 7 per cent on the previous year. According to the latest Which? survey on house insurance, last year's payout continued a rise from pounds 90m in 1987. Insurers are raising buildings insurance premiums dramatically as a result, and many have increased the excess from pounds 500 to pounds 1,000. Most companies are also raising premiums for those who live in subsiding areas.

The Subsidence Claims Association, which was launched in July to help victims make claims, already has nearly 100 paid- up members. The ABI is sceptical. Its spokesman said: 'It should be unnecessary to have such an association. Insurers have paid out record amounts, and as quickly as possible.'

Subsidence Claims Association, Swedenborg House, 21 Bloomsbury Way, London WC1A 2TH.