You’ve recently made a big investment in sustainable energy by adding solar panels to your home. But now a new question arises: Does your home insurance protect your solar panels? Protecting your new solar power system is crucial for your peace of mind.
Understanding the details of solar panel insurance can seem complicated, but it’s a necessity. This guide will walk you through what you need to know about how insurance can cover solar panels.
The good news is that you likely won’t need a completely new insurance policy just for your panels. In most situations, you can extend your current homeowners insurance policy to cover your solar system. However, the insurance coverage provided depends on the type of solar panel installation.
If your rooftop solar panels are a permanent attachment to your house, they’re usually considered part of the home’s structure. This means your policy’s dwelling coverage likely protects them. This part of your homeowners insurance policy helps pay for repairs to the physical structure of your house after a covered event.
What about panels that aren’t on your roof? Ground-mounted panels or those on a separate structure fall under your “other structures” coverage. It’s always a good idea to confirm your specific policy details with your insurance agent so you know your panels covered status.
This is an important question. Your existing coverage limit was based on your home’s value before you chose to add solar panels. Now, you have a valuable new asset to protect.
A full residential solar panel system can be a big financial investment. According to the Center for Sustainable Energy, the average cost of residential solar energy systems ranges from $15,000–$25,000. Therefore, you’ll likely need to increase your dwelling coverage limit to account for this added value.
Increasing your coverage limit will likely result in a slight increase in your insurance premium. This slight cost is much better than being underinsured if a storm damages your expensive new solar energy system. You want enough insurance coverage to fully replace the panels if a catastrophe happens.
Many people choose to lease their solar energy systems instead of buying them outright. Leasing means you pay a monthly fee to use the solar panels, but the solar company retains ownership of the system. In this case, the insurance responsibilities can change significantly.
Some solar leasing companies carry their own business insurance policies that cover the equipment they own. This can be beneficial, as you might not need to adjust your personal coverage. You must review your lease agreement carefully to understand the insurance terms.
Other companies, however, may require you to add the panels to your homeowners insurance policy, making you responsible for the insurance coverage. They might even offer their own panel insurance plan you can purchase. No matter the arrangement, you should always inform your insurance company that you’ve installed a rooftop solar energy system, even if you lease it.
Solar panels are exposed to the elements year-round. Because of this constant exposure, some insurance policies have specific rules about weather-related damage. It’s vital to check your policy documents for these details.
Many insurers have policies that exclude damage from wind or hail for solar panels, which could leave you with a major bill after a natural disaster. This is a critical detail, especially if you live in an area known for severe weather. You wouldn’t want a hailstorm to destroy your rooftop panels only to find out your policy doesn’t cover solar.
If your policy has this exclusion, you still have options. You might be able to add an endorsement or rider for extra protection. Speaking with your insurance agent is the best way to explore what is available from various underwriting companies.
Sometimes, your standard homeowners policy isn’t the best option for your new rooftop solar energy system. This can happen if your insurer doesn’t offer adequate solar panel insurance coverage. It could also be that their offered coverage is too limited for your needs.
In these scenarios, getting a separate solar panel insurance policy might be a wise decision. This separate policy is designed specifically for renewable energy equipment and can provide specialized protection that a general home policy might not, such as for equipment malfunctions.
When searching for a separate solar panel policy, you’ll want to obtain a quote and confirm whether it covers wind and hail damage. Not all stand-alone policies do, so reading the fine print is essential. A separate solar panel insurance policy should provide comprehensive protection, and understanding its limits is crucial.
Comparing the options can help you make an informed choice. Here is a look at how a standard policy endorsement stacks up against a separate policy.
| Feature | Homeowners Insurance Endorsement | Separate Solar Panel Insurance |
|---|---|---|
| Coverage Type | Adds the value of the panels to your existing dwelling or other structures coverage. | A dedicated policy just for the solar panel system and its components. |
| Peril Coverage | Typically covers the same perils as your main homeowners policy (fire, theft) but may have exclusions for wind/hail. | Often provides broader, all-risk coverage, potentially including mechanical breakdown not caused by a home-related peril. |
| Cost | Usually results in a modest increase to your existing insurance premium. | A separate, often higher, premium, but it offers more targeted panel insurance coverage. |
| Claims Process | An insurance claim is filed against your homeowners policy, which could impact future rates or eligibility. | An insurance claim is filed against the separate policy, not affecting your primary homeowners insurance. |
Switching to solar energy is a great choice for your finances and the planet. Protecting that choice with the right insurance coverage is equally important.
Before your installation begins, contact your insurance agent to discuss your plans. Have a detailed conversation about your current coverage and what changes are necessary. This simple step ensures your investment in a solar system is properly protected from day one, giving you complete peace of mind.
Address: 231 W Rutherford Blvd
Murfreesboro, TN 37130
Phone:615-237-1737
Business Hours:
Mon - Fri: 7:30 AM - 4:30 PM
Sat & Sun: Closed