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? Can you purchase any solar panel insurance?
The good news is that you may have coverage under your homeowners policy. Keep reading to learn more.
Does Home Insurance Cover Solar Panels?
As long as your solar panels attach to your home, they’ll have coverage under the dwelling portion of your homeowners policy. However, you’ll only receive coverage if a covered peril damages your panels.
Covered perils are the types of damages your homeowners insurance will cover. For example, if your solar panels undergo hail or fire damage, your homeowners policy may cover the repair or replacement.
Your policy probably won’t cover damage from wear and tear, flooding and earthquakes. You’ll need to purchase a separate policy to protect panels from these events.
Make sure to review your policy and speak with your insurer to ensure your panels have the necessary coverage in the event of an incident.
[Related: Can Solar Panels Withstand a Hurricane?]
Do Solar Panels Increase Home Insurance?
Your solar panels may increase the price of your homeowners policy. However, your insurance policy rates increase because solar panels add value to the price of your home with solar panels.
Homeowners policies typically rate their premiums according to the home’s value to adequately cover the home in the event of a covered accident. That’s why 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
You’ll need to add coverage or buy a separate policy to cover your solar panels in some situations. For example, you’ll need a separate policy if your solar panel system doesn’t attach to your home’s roof. This includes ground-mounted panels in your yard, wall-mounted panels on a separate surface and carport-mounted panels.
Solar panels that directly attach to your house will have insurance coverage under your homeowners policy. But every insurer handles policies differently, so be sure to contact your insurance agent to determine your best course of action.
[Related: Where To Install Solar Panels]
Do You Need To Tell Your Insurance About Your Solar Panels?
Yes, we always recommend reaching out to your insurance company about your solar panels.
Telling your insurance company that you have solar panels will help it rerate your policy and determine whether you need additional coverage. Your agent will also have the choice to offer you insurance products that’ll best cover your solar panel investment.
Should You Increase Your 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 it protects your solar panels in the event of an incident. Your agent can 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 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 up-front, 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, you must reach out to your solar company to check whether it offers insurance over panels in the event of a random accident or weather-related event.
A few companies may require you to purchase your own policy over the panels. Again, make sure you review this question with your solar energy provider.
[Related: Who Makes the Best Solar Panels?]
Solar Panel Insurance Cost
Insurance companies consider solar energy systems attached to your house as permanent attachments, so they typically roll the cost to insure them into your homeowners coverage. When you install these panels, the coverage limit on your policy changes.
You’ll want to make sure your policy limit is high enough to cover damage to your home as well as your solar panels, especially if they undergo severe damage. You may even want to factor 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. But if you purchase SunPower solar panels from solar power installers Freedom Solar Power, you can expect to pay an average of $38,000 for a 9.1 KW system. With that said, you should increase your homeowners policy coverage limit because doing so adds price significantly to the value of 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 may cause 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. That leaves you to pay out of pocket for the repairs.
The only way to know whether your policy covers the damage is to reach out to your insurer. They’ll let you know if that particular damage is a covered peril. However, if you partner with a reputable installation team, they’ll ensure no damage to your roof occurs during the installation process.
In addition, look at reviews before settling with a contractor. This will give you an idea of what customers did and didn’t like about their services.
You should also ask your contractor to show you their licenses and proof of insurance before they perform 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 you should look into additional coverage if you notice your homeowners insurance policy doesn’t adequately cover your solar panels.
Solar panel company Freedom Solar can help with the purchase and installation process if you’re looking for a home solar installation. Our licensed and insured solar panel professionals ensure technicians correctly install solar panels on your home.
We also have our own solar repair and maintenance service department if needed. Our experienced team can maintain, repair and upgrade any system for maximum energy production and efficiency
Contact us today by calling (800) 504-2337, or complete our online inquiry form. We’re ready to start your free consultation!
Featured image via Pixabay