But the ABI says the oil and gas exploration method so far presents little evidence of an increased risk to homeowners
Insurers could start to ask homeowners about fracking activity in their area amid concerns the process could damage properties, City AM reports.
The ABI said the industry is monitoring fracking exploration and looking at data on seismic activity around fracking sites, but added that so far there was little evidence to suggest the process posed any increased risk.
The ABI’s Stephen Sobey said the association had been in discussions with government about this method of oil and gas exploration.
“Unless it is specifically requested by an insurer, homeowners do not currently need to disclose their proximity to fracking sites. However, if it is requested by an insurer, then this does need to be disclosed,” Sobey said.
“There is, at present, little evidence to show a link between fracking and seismic activity that could cause damage to a well-maintained property, however, insurers will continue to monitor the potential for fracking, or similar explorations, to cause damage.”
Legal & General pricing and underwriting director Russell Byrne said he could not see any exclusions which would invalidate a policy if the damage was caused by fracking as policyholders are currently covered for damage caused by earthquake, subsidence, heave and landslip.
“We are waiting to find out more and we’re working with the ABI closely,” he added.
A spokesman for Aviva also said it was working with the ABI on the matter and added: “Currently fracking is not an issue for home insurers and we are comfortable that there is a robust approval process before any fracking can take place.”