Solar Panels and Homeowners Insurance – What’s Covered?
Going solar is one of the best ways you can personally combat climate change and make a positive impact. But with climate change comes more frequent natural disasters.
How do you protect your solar panel system from hurricanes and other disasters?
Insuring your solar PV system: It’s a part of your home!
Similar to a patio or a security system, solar energy systems are a permanent attachment to your property.
This means that as long as you own your solar panels and they are rooftop-mounted (additional policies may be required for ground-mounted systems), the system will be included under a homeowner’s policy and covered in standard plans without raising your premium.
In most cases, there is no need to get additional insurance to cover your solar panel system.
However, since solar is worth thousands or even tens of thousands of dollars and can add around $10,000 to $30,000 of value to your home, we might recommend raising your coverage limit to cover the cost of your home with the solar panel system.
The solar panel insurance cost will depend on various things like your location, your current coverage amount, the size and cost of your system, and your insurance company’s plan. Claims for damaged solar panels would also vary based on your insurance plan, but likely follows the same process as other damaged property claims.
If It’s Third Party Owned, They Cover It
If you subscribe to a PPA or lease your solar panels, a third party owns your system and is responsible for damage and maintenance.
In this case, you will not be responsible for ensuring coverage, but you should talk to your lease or PPA provider before committing to make sure that any unforeseen damage will be covered.
System Warranties Don’t Include Disasters
Solar.com’s qualified installers all to provide a robust warranty that includes a Workmanship Warranty and a Manufacturer Warranty. This means your installer or the manufacturer or the system will cover most damages, malfunctions, or failures due to the installation of the system or material and processing defects.
However, most warranties do not cover what is called “Acts of God,” which include natural disasters like fires, hurricanes, and the like.
Your installer warranty will cover any damage that occurs to your home or solar panels during the installation process.
Protecting Your Solar with Homeowner’s Insurance
The list of perils your insurance provider covers varies from company to company, so make sure to check what is covered under your specific plan. A solar panels fire insurance, for instance, will most likely be looped in with other aspects of your primary homeowner’s insurance.
Here is a list of common hazards that are covered by most insurance companies, according to the Insurance Information Institute,
- Fire and smoke (including wildfires)
- Lightning strikes
- Windstorms and hail (in only 31 states)
- Vandalism and malicious mischief
- Damage from an aircraft, car or vehicle
- Falling objects (usually can be covered under premium plans)
- Weight of ice, snow or sleet
- Water damage
Special Coverage for Hurricane Areas
Damage due to wind and flooding in states that have frequent hurricanes is typically not covered in standard home insurance policies. In the following 19 states along the coasts of the United States, Wind Insurance (sometimes called Windstorm, Wind, and Hail, Named Storm or a Hurricane Policy) is separate from standard homeowner’s insurance.
- New Jersey
- New York
- North Carolina
- Rhode Island
- South Carolina
Wind insurance is a percentage deductible, so you will have to pay out of pocket for a set percentage of the cost of your home (including the cost of your solar system) rather than a set dollar amount. Wind insurance deductibles range from about 1% to 5% but could be higher depending on your state’s susceptibility to hurricanes or another natural disaster. The cost of additional Windstorm Insurance depends on your deductible, your location, and the projected cost to rebuild your home.
If you are a solar owner in one of these states, you may look into adding a wind policy to your home insurance. With the addition of this policy, your solar will be covered for wind damage as well. However, insurers will not add or adjust your policy once a storm has begun, so if you’re worried about wind damaging your solar, don’t wait!
Special Coverage for Earthquake Areas
While a standard home insurance policy covers the losses from a fire following an earthquake, it will not cover damages from the earthquake itself.
Earthquake insurance policies are administered separately from home insurance. Solar panels are highly resistant to earthquakes, but if you live near a fault line in California then additional earthquake insurance may be necessary to protect your home solar panel system.
Be Sure to Choose Good Panels and a Vetted Installer
The best way to determine if your solar is protected against any form of natural disaster is to talk to your insurance company about your specific plan.
In regards to your solar project, Solar.com’s Energy Advisors are here to guide you through going solar. A well-installed system with high-quality equipment is the most important way to ensure your solar panels will keep producing electricity for decades into the future.