Many homeowners are starting to embrace the idea of generating their own electricity using solar panels. This is due to the numerous benefits they provide, the most enticing one being the extent to which they can reduce electricity bills. If you’re planning to install solar panels on your property, you may be wondering if they are covered by your property insurance. The answer to that is–it depends.
To start with, let’s take a look at how solar panels fit into homeowners insurance.
Are Solar Panels Protected by Homeowners Insurance?
Yes, solar panels are protected, but there are circumstances under which the answer is not so straightforward. Solar panels are usually permanent fixtures to the roof of a home and are thus regarded as part of the home. This allows the general benefits of homeowners insurance to be extended to them so they are covered against certain risks such as storms, theft, vandalism, fire, and so on.
However, if your solar panels are set up in structures separate from your home building but on the same property, they are covered under the “other structures” aspect of your homeowners insurance policy. These other structures include fences, barbs, garage, and solar panel structures as well. Typically, insurance companies have different coverage limits for main structures and other structures on the same property. In most cases, the coverage limit for other structures is 10% of the valuation of the main structure. So, if your home is valued at $100,000, your other structures on the same property will have a coverage limit of $10,000. To ensure that your solar panels have enough coverage, check your homeowners insurance policy and make necessary adjustments if needed.
How Do Solar Panels Affect Homeowners Insurance?
If your solar panels are installed on the roof of your home, most homeowners insurance policies will consider it a part of your home and you won’t need to buy a special add-on plan for it. Your premium will also remain unchanged if this is the case. You should, however, note that in the event of an unforeseen disaster that damages your home, your coverage limit may not be sufficient to repair your house and replace your solar panels as well. Solar panels are not cheap. An average 10kW solar panel system costs about $24,000 dollars. This is why you should consider increasing your coverage limit, so that you’re sure of being adequately protected.
Additionally, since solar panels in separate structures have coverage limits that are only about 10% of the valuation of the main building, you may want to consider getting a separate or add-on policy to make sure you’re fully covered.
Are Solar Panels Covered by Commercial Property Insurance?
While homeowners insurance will generally cover solar panels in separate structures under the “other structures” part of the policy, most commercial insurance policies won’t. This is because the risks of insuring stand-alone solar panels on commercial properties are high. Special attention has to be paid to their maintenance, and workers have to be careful around them as fatal accidents can easily occur. Vandalism can also occur easily, leading to damages and costly repairs.
Do you need help with ensuring that your costly solar panels are covered sufficiently by your property insurance? Contact us at Weeks & Associates Insurance Services in Thousand Oaks, California. We’re ready to meet all your insurance needs today.