Escape of Water: How Early Detection Reduces Insurance Claims
The difference between a minor incident and a major claim is often just hours.
Escape of water (EoW) is consistently the largest source of property insurance claims in the UK. For housing providers and property portfolios, these claims represent significant financial exposure—and the majority of the damage occurs because leaks aren't detected quickly enough.
The Scale of the Problem
Industry Statistics
The numbers are stark:
- Escape of water accounts for approximately 30% of home insurance claims
- Average claim values have increased significantly in recent years
- A major leak can cause £50,000+ in damage to a single property
- Claims often affect multiple properties (flats, neighbours)
Why Claims Are Growing
Several factors are driving increased EoW claims:
- Ageing housing stock with deteriorating pipework
- More complex plumbing systems (combi boilers, wet underfloor heating)
- Increased use of flexible hoses with limited lifespans
- Properties left unoccupied for longer periods
- Climate change causing more freeze-thaw cycles
The Time Factor
How Damage Escalates
The relationship between detection time and damage is exponential:
| Detection Time | Typical Damage |
|---|---|
| Within 1 hour | Minor cleanup, potential flooring damage |
| Within 24 hours | Significant water damage, drying required |
| Days undetected | Structural damage, ceiling collapse risk |
| Weeks undetected | Major remediation, mould growth, electrical damage |
A burst pipe releasing 10 litres per minute causes £600 of damage per hour it runs undetected.
Unoccupied Property Risk
The risk is highest when properties are empty:
- Void periods between tenancies
- Holidays and travel
- Properties in mixed portfolios with irregular visits
- Student accommodation during holidays
A leak over a bank holiday weekend can cause more damage than one discovered within hours.
Early Detection Technologies
Point Sensors
Placed at high-risk locations:
- Under sinks and basins
- Behind washing machines and dishwashers
- Near water heaters and boilers
- In plant rooms and utility areas
These detect water presence at specific points—effective for catastrophic failures.
Environmental Monitoring
Humidity sensors can detect leaks indirectly:
- Sudden humidity spikes indicate possible water ingress
- Can detect concealed leaks that point sensors miss
- Useful for whole-property monitoring, not just specific points
Flow Monitoring
Detecting abnormal water usage:
- Continuous flow when property should be empty
- Usage patterns outside normal parameters
- Gradual increases suggesting developing leaks
Automatic Shut-Off
Taking detection further:
- Valves that close automatically when leaks detected
- Can be triggered by sensors or flow anomalies
- Limits damage even when property is unoccupied
Implementation Strategies
Risk-Based Targeting
Focus resources where risk is highest:
- Age of property: Older properties with original plumbing
- Property type: Flats where damage affects multiple units
- Occupancy pattern: Properties frequently empty
- Claims history: Properties or archetypes with prior incidents
Coverage Approach
Options for deployment:
- Full coverage: Sensors at all water points plus environmental monitoring
- High-risk focus: Kitchen, bathroom, and utility areas only
- Environmental only: Humidity monitoring to detect indirect signs
- Critical locations: Plant rooms, risers, communal areas
Response Protocols
Detection is only useful if you respond:
- 24/7 alert monitoring (in-house or third party)
- Clear escalation procedures
- Access to emergency contractors
- Tenant communication protocols
The Insurance Perspective
Insurer Interest
Insurance companies are actively promoting leak detection:
- Some offer premium discounts for monitored properties
- Growing requirement for certain policy types
- Active partnerships with technology providers
Claim Benefits
Beyond premium savings, monitoring affects claim outcomes:
- Evidence that detection and response was timely
- Demonstration of proactive risk management
- Smaller claims through faster intervention
- Fewer disputes over claim circumstances
Business Case
Cost-Benefit Analysis
For a typical portfolio:
| Factor | Without Monitoring | With Monitoring |
|---|---|---|
| Average detection time | 24-72 hours | Under 1 hour |
| Average claim value | £8,000-£15,000 | £2,000-£5,000 |
| Annual claims (per 100 properties) | 3-5 | 3-5 (but lower value) |
| Void period impact | Weeks for drying/repair | Days for minor cleanup |
Beyond Insurance
Additional benefits include:
- Reduced tenant disruption and complaints
- Avoided damage to neighbouring properties
- Lower repair and remediation costs
- Preserved property value and condition
Integration with Environmental Monitoring
Leak detection complements damp and mould monitoring:
- Same infrastructure: Sensors can monitor multiple parameters
- Combined dashboards: Single view of property conditions
- Holistic alerting: Any water-related issue flagged
- Operational efficiency: One system, multiple use cases
Complete Water Risk Management
DMS Smart Monitor combines environmental monitoring with leak detection—addressing both damp prevention and escape of water in a single platform.
Insurer Solutions