Reduce the risks from property damage caused by clay shrink swell
Understand how clay shrink swell can affect your home and the insurance position
What is clay shrink swell?
Clay soil consistency can easily change depending on the soil’s water content. When it rains, clay soils absorb water and expand like a sponge. When it is dry, the water contained in the clay soil evaporates and the clay soil shrinks.
A clay shrink swell event can occur if the relevant local factors are present and combined with the triggering climate factors:
- Local factors: These include aspects such as the constitution of the soil (it needs to contain clay), the inclination of the area, the hydrological context of the area, surrounding vegetation etc. As the name indicates, there must be clay in the soil composition. It is estimated that a clay shrink swell event can occur if the soil composition is of at least 10% clay.
- Climate factors: Triggering factors of evapotranspiration and precipitation from weather events such as droughts, heatwaves and rainfall can trigger a clay shrink swell event in areas where the relevant local factors are present.
Clay shrink swell is a significant and widespread problem in France
Clay shrink swell events mainly affect single-family homes and are widespread in France. It is estimated that the medium or high risk of clay shrink swell events concern :
48%
of the national territory
10,4M
of single-family homes
54%
of all single family homes
Common types of property damage caused by clay shrink swell
Some of the most frequent property damage caused by clay shrink swell are:
- Cracks in the foundations
- Subsidence of the structure
- Deformation of walls and floors
The property damage caused by clay shrink swell can in some cases be so severe that demolition of the property is recommended.
The role of climate change
Because the local factors for any geographic location can be assumed to remain relatively constant, increasing likelihood of a clay shrink swell event occurring is related to climate change.
More specifically to the increasing likelihood of weather events such as :
droughts
heatwaves
rainfall
These conditions can potentially trigger a clay shrink swell event.
This tool uses climate data projections to provide an illustration of the increasing likelihood of clay shrink swell occuring in your local area.
Home insurance cover and natural catastrophes - the Cat Nat scheme
In France, a national mechanism called Cat Nat is a compensation scheme for homeowners, companies and local authorities for damage caused by natural catastrophes.
Insurance companies typically offer multi-risk home insurance policies to cover properties, and they are reinsured by the Caisse Centrale de Réassurance (CCR) for payouts when a natural catastrophe has been declared.
If a natural catastrophe occurs which is covered by the Cat Nat scheme, the Mayor and then the Prefect must submit an official request to the State to recognise the occurrence of a natural catastrophe through a decree.
Once this decree is officially published, the insurer assesses the cost of damage and indemnifies the homeowner and is then reinsured by the Caisse Centrale de Réassurance (CCR).
Recognition of clay shrink swell under the Cat Nat scheme
For a clay shrink swell event to be recognised as a natural catastrophe under the Cat Nat scheme, two conditions must be met:
- the affected area has at least 3% of its surface mapped as shrinkable clay
- the meteorological conditions that have occurred must be identified as being exceptional periods of drought.
It is estimated that the cumulative cost of drought claims between 2020 and 2050 would be €43 billion which represents a threefold increase compared to the previous three decades.
In the face of these significant increases in the cost related to clay shrink swell events, there are concerns, in the insurance world and at the national level, that the Cat Nat scheme would no longer be able to generate sufficient reserves to cover claims by 2040.
No recognition under Cat Nat scheme - then no insurance payout
Over the last nine years, an average of 50% of requests for official recognition of a clay shrink swell event as a natural catastrophe under the Cat Nat scheme have been unsuccessful. It is critical to note that homeowners are only covered for damage from a natural catastrophe which is officially recognised as such by the Cat Nat scheme (following the process articulated above). Where the Cat Nat scheme does not officially recognise the natural disaster, the homeowner is not insured for any property damage.
Official recognition of a natural catastrophe for clay shrink swell can be refused for three main reasons.
1
when the case prepared by the Prefect is deferred due to incomplete documentation.
2
although rare, when there is evidence of failure in implementing necessary preventive measures.
3
when the exceptional intensity of the event is not proven.
For clay shrink swell, it is particularly challenging to prove the exceptional intensity of the event because it can occur over prolonged periods and may not present immediate, dramatic impacts compared to other natural disasters like floods or earthquakes.
Potential insurance risks for homeowners
Despite the existence of the Cat Nat scheme operating with multi-risk home insurance, there are several risks for homeowners apparent with this process:
Typical process for recognition of a natural catastrophe under the Cat Nat scheme, which might last up to 2 years and 5 months.
What can you do to address your risks?
You can take action today by adopting preventive measures and being well-informed about your rights and obligations.