Solar Panel Insurance: How Solar Panels Affect Home Insurance
January 5, 2022
Solar panels are a great investment if you’re looking for a way to generate energy and save money at the same time. And like with any great investment, you’ll want to protect your solar panel system.
So how do you cover your solar panels? Is there solar panel insurance you can purchase?
The good news is that you may have coverage under your homeowners policy. Keep reading to learn more.
Are Solar Panels Covered by Home Insurance?
Yes, your solar panels are likely covered by your home insurance.
As long as your solar panels are attached to your home, they’ll have coverage under the dwelling portion of your homeowners policy. However, you’ll only receive coverage if your panels are damaged from a covered peril.
Covered perils are the types of damage your homeowners insurance will cover. For example, if your solar panels receive damage from a fire or hail, your homeowners policy may cover the repair or replacement.
Your policy likely won’t cover damage from wear and tear, flooding, or an earthquake — you’ll need to purchase a separate policy to protect your panels from these events.
Make sure to review your policy and speak with your insurer to ensure that your panels have the necessary coverage they need in the event of an incident.
[Related: Can Solar Panels Withstand a Hurricane?]
Do Solar Panels Increase Home Insurance?
Homeowner policies typically rate their premiums according to the value of the house to adequately cover the home in the event of a covered accident. So you’ll need to increase your insurance policy to match the increase in your home’s value.
[Related: What to Expect: Your HOA and Solar Panels]
Getting an Additional Insurance Policy for Solar Panels
There are situations where you’ll need to add additional coverage or buy a separate policy to cover your solar panels. For example, you’ll need a separate policy if your solar panel system is not attached to your home’s roof and is instead ground-mounted in your yard, wall-mounted on a separate surface, or mounted on a carport.
Solar panels that are directly attached to your house will have insurance coverage under your homeowners policy. But every insurer handles their policies differently, so be sure to contact your insurance agent to determine the best course of action.
[Related: Where to Install Solar Panels]
Do You Need to Tell Your Insurance About Your Solar Panels?
Yes, reaching out to your insurance company about your solar panels is always recommended.
Informing your insurance company that you have solar panels will help them re-rate your policy and determine if you need additional coverage. They’ll also have the choice to offer you insurance products that will best cover your solar panel investment.
Should I Increase My Coverage After Installing Solar Panels?
The answer to this question depends on your insurer and your homeowners policy rules. It’s best to increase your coverage to ensure that your solar panels are protected in the event of an incident. Your agent will be able to point you in the right direction to let you know what works best for you and your insurance situation.
How Leasing Solar Panels Affects Your Home Insurance
Luckily you have the option to lease solar panels if you want to start using solar energy but don’t have the initial investment to make a purchase. Many solar energy companies offer an opportunity for you to lease their panels if you want to install their solar power system. This option costs little to nothing upfront, depending on the company you partner with.
You typically don’t need to purchase insurance for leased solar panels because you don’t own them. However, it’s crucial that you reach out to your solar company to check if they offer insurance over them in the event of a random accident or a weather-related event.
A few companies may require you to purchase your own policy over the panels. Again, make sure that you review this question with your solar energy provider.
[Related: Who Makes the Best Solar Panels?]
Solar Panel Insurance Cost
Solar energy systems that are attached to your house are considered permanent attachments, so the cost to insure them is typically rolled into your homeowners coverage. What will change when you install these panels is the coverage limit on your policy.
You’ll want to make sure that your policy limit is high enough to cover your home’s damage and the solar panels’ damage as well, especially if they experience severe damage. You may even want to factor in your system’s complete replacement costs into your overall coverage limit.
The price for a residential solar energy system depends on the state you live in, with averages ranging from $8,000 to $15,000. You should increase your homeowners policy coverage limit since this will add significant value to your home.
However, raising your coverage limit shouldn’t affect your premium too significantly.
[Related: What to Know Before Installing Solar Panels]
Damaged Roof From Installation
Installing solar panel systems on your roof can possibly damage if you don’t work with licensed and experienced solar installation teams. If a contractor damages your home, your homeowners insurance may not cover this damage, leaving you to pay out of pocket for the repairs.
The only way to know if your damages are covered is to reach out to your insurer. They’ll let you know if this particular damage is a covered peril. However, if you choose to partner with a reputable installation team, they will ensure that there is no damage to your roof during the installation process.
Make sure to look at reviews before settling with a contractor. This will give you an idea of what customers did and did not like about their services. You should also ask your contractor to show you their licenses and proof of insurance before performing any job. This will give you backup for coverage if your homeowners insurance refuses to cover damage from a contractor’s solar installation.
Contact Freedom Solar to Install Your Solar Panels
Going solar is one of the most environmentally responsible choices you can make. But make sure you look into additional coverage if you notice your homeowners insurance policy does not adequately cover your solar panels.
Freedom Solar can help with the purchase and installation process if you’re currently in the market for a solar energy system for your home. Our licensed and insured solar panel professionals will ensure that your solar panels are correctly installed on your home.
Contact us today by calling +1 (800) 504-2337 or complete our online inquiry form to begin your free consultation!
Featured image via Pixabay