Yes, most homeowners insurance policies do cover solar panels, but the extent of coverage depends on several key factors including how they’re installed, whether you own or lease them, and your specific policy terms. As solar adoption continues to surge in 2025—with residential installations growing 24% annually over the past decade—understanding your insurance coverage has become more critical than ever.
In this comprehensive guide, you’ll learn exactly when solar panels are covered, how they impact your premiums, the crucial differences between owned and leased systems, and actionable steps to ensure your solar investment is fully protected. We’ve analyzed the latest 2025 insurance landscape to provide you with the most current information available.
The Complete Coverage Breakdown
When Solar Panels ARE Covered
Most homeowners insurance policies treat roof-mounted solar panels as permanent fixtures, similar to built-in appliances or security systems. This means they typically fall under your dwelling coverage—the same protection that covers your home’s structure.
Roof-Mounted Panels as Permanent Fixtures
When solar panels are permanently attached to your roof, insurance companies generally consider them part of your home’s structure. This classification is crucial because it means:
- No separate policy required for basic coverage
- Coverage limits match your dwelling coverage (typically much higher than other structures)
- Claims are processed under your standard homeowners policy
- Deductibles remain the same as other dwelling claims
Covered Perils: What’s Protected
Standard homeowners policies typically cover solar panels against these common perils:
- Fire and smoke damage – Including electrical fires and wildfire damage
- Lightning strikes – Both direct hits and electrical surge damage
- Hail damage – Though some insurers are adding exclusions in high-risk areas
- Wind damage – From storms and hurricanes (with some regional exceptions)
- Theft and vandalism – Including stolen panels and intentional damage
- Falling objects – Such as tree branches or debris
Real Claim Examples and Payouts
According to 2025 industry data, solar panel insurance claims can range from minor repairs to complete system replacement. The average repair for storm damage to commercial systems exceeds €15,000, while complete system replacements for enterprise installations can require capital outlays in the hundreds of thousands. For residential systems, typical claim scenarios include:
- Hail damage: Varies based on system size and extent of damage
- Wind damage: Costs depend on reinstallation requirements
- Lightning strike: May require inverter and panel replacement
When Solar Panels MAY NOT Be Covered
Understanding coverage limitations is just as important as knowing what’s protected. Several scenarios can leave you without coverage or with limited protection.
Ground-Mounted Systems Coverage Gaps
Ground-mounted solar panels face different coverage rules than roof-mounted systems. Most policies treat them as “other structures,” which typically means:
- Coverage limited to 10% of your dwelling coverage amount
- Separate deductible may apply
- Different exclusions may apply
- May require additional endorsements for full protection
Example: If your home is insured for $300,000, ground-mounted panels would only be covered up to $30,000 under standard other structures coverage—potentially insufficient for larger systems.
Excluded Perils and Regional Variations
Certain types of damage are commonly excluded from standard policies:
- Flood damage – Requires separate flood insurance
- Earthquake damage – Needs earthquake insurance endorsement
- Normal wear and tear – Maintenance issues aren’t covered
- Manufacturer defects – Covered by warranties, not insurance
In 2025, some insurers in hail-prone areas have begun excluding or limiting wind and hail coverage for solar panels, requiring separate endorsements.
Owned vs. Leased Solar Panels: Critical Insurance Differences
The ownership structure of your solar system dramatically affects your insurance responsibilities and coverage options. This distinction has become increasingly important as solar leasing programs have evolved.
Owned Solar Panel Coverage
When you own your solar panels outright, you have complete responsibility for insuring them, but also full control over your coverage options.
Full Ownership Responsibilities
As the owner, you’re responsible for:
- Ensuring adequate coverage limits to replace the entire system
- Maintaining current replacement cost valuations
- Filing and managing insurance claims
- Coordinating repairs with approved contractors
- Paying deductibles for covered losses
Coverage Limit Considerations
The most critical aspect of insuring owned solar panels is ensuring your coverage limits are adequate. In 2025, average residential solar system costs are around $29,360 before incentives, with ranges varying by system size:
- Small systems (5-6 kW): $14,210 before incentives
- Medium systems (7-10 kW): $21,000 – $29,000
- Large systems (10-15 kW): $29,000 – $43,000
- Premium systems (15+ kW): $43,000+
Replacement Cost vs. Actual Cash Value
Most homeowners policies offer replacement cost coverage for dwelling-attached solar panels, meaning you’ll receive enough money to replace your system with new equipment of similar quality. However, some policies may only provide actual cash value (replacement cost minus depreciation), which could leave you significantly short of full replacement costs.
Important: Always verify your policy provides replacement cost coverage for solar panels, not actual cash value.
Leased Solar Panel Coverage
Solar leasing arrangements create a more complex insurance landscape, with responsibilities split between you and the leasing company.
Leasing Company Insurance Responsibilities
In most lease agreements, the solar company maintains insurance coverage for:
- The solar panels and equipment
- System performance and functionality
- Replacement of damaged or stolen panels
- Maintenance and repairs not caused by homeowner negligence
Homeowner Liability Gaps
However, important coverage gaps may exist for leased systems:
- Roof damage – Your insurance typically covers roof repairs, even if caused by leased panels
- Electrical issues – Damage to your home’s electrical system may be your responsibility
- Removal costs – Emergency removal costs might not be covered by the leasing company
- Liability claims – If panels cause injury or property damage to others
Contract Review Checklist
Before signing a solar lease, review these insurance-related provisions:
- Who carries insurance on the panels and equipment?
- What happens if panels damage your roof?
- Are you required to maintain specific insurance coverage?
- Who’s responsible for removal costs in emergencies?
- What liability coverage does the leasing company provide?
- How are insurance claims handled and processed?
How Solar Panels Impact Your Insurance Costs
Understanding the financial impact of solar panels on your insurance premiums is crucial for accurate budgeting and decision-making.
Premium Changes Analysis
Based on 2025 market data, most homeowners see modest premium increases after installing solar panels, primarily due to increased dwelling coverage limits rather than higher risk assessments.
Average Cost Increases by Region
Premium increases vary significantly by location due to regional weather risks and local insurance market conditions. For those who do see increased homeowners insurance costs after they go solar, payments can go up by as little as $15 a month, or closer to a thousand dollars if they choose to get a separate solar panel coverage policy:
- Low-risk areas: $15-50 monthly increase
- Moderate-risk areas: $50-100 monthly increase
- High-risk areas: $100-200 monthly increase
- Extreme-risk areas: $200+ monthly increase
Real Homeowner Case Studies
Premium increases depend on multiple factors including system value, regional risk, and current coverage limits. Homeowners should expect increases proportional to their system’s replacement cost and local risk factors. For those considering different payment structures, exploring solar financing options can help manage both installation costs and insurance implications.
Replacement Value Calculations
Accurately calculating your solar system’s replacement cost is essential for proper coverage.
How to Calculate Your System’s Replacement Cost
Use this formula to determine adequate coverage:
Base System Cost + Installation + Permits + Electrical Upgrades + 15% Inflation Buffer = Total Replacement Cost
Example calculation for a typical system:
- Solar panels and inverters: $18,000
- Installation labor: $4,500
- Permits and inspections: $800
- Electrical upgrades: $1,200
- 15% inflation buffer: $3,675
- Total replacement cost: $28,175
Regional Installation Cost Variations
2025 installation costs vary significantly by region. According to the most recent data from the EnergySage Marketplace, the average cost-per-watt across the U.S. is around $2.56/W before incentives, with lower $/W pricing in warmer states and higher $/W pricing in colder states. California has the lowest average cost of solar, while West Virginia and Alabama have some of the highest prices.
Installation and Roof Damage Coverage
Installation-related damage represents one of the most complex aspects of solar panel insurance, with coverage responsibilities often split between multiple parties.
Installation Damage Scenarios
Contractor Liability vs. Homeowner Insurance
When installation damage occurs, determining who pays depends on the specific circumstances:
Contractor’s responsibility:
- Roof damage during installation
- Improper mounting causing immediate leaks
- Electrical damage from faulty wiring
- Structural damage from improper attachment
Homeowner’s insurance responsibility:
- Pre-existing roof conditions that fail after installation
- Damage from covered perils during installation
- Secondary damage from installation-related issues
Roof Leak Coverage After Installation
Roof leaks after solar installation are particularly complex:
- Immediate leaks (within 30 days): Usually contractor’s responsibility
- Short-term leaks (30 days – 2 years): May be covered by workmanship warranty
- Long-term leaks (2+ years): Could be homeowner’s insurance if not due to poor workmanship
Workmanship Warranty vs. Insurance Coverage
Understanding the distinction between warranties and insurance is crucial:
Workmanship warranties typically cover:
- Installation defects for 5-25 years
- Roof penetration sealing issues
- Mounting system failures
- Electrical connection problems
Insurance typically covers:
- Storm damage during installation
- Theft of equipment during installation
- Accidental damage to other property
- Liability for injuries during installation
Choosing Installation Companies
Selecting the right installer is crucial for protecting your insurance interests.
Insurance and Bonding Requirements
Verify your installer carries adequate insurance:
- General liability: Minimum $1 million per occurrence
- Workers’ compensation: Required in most states
- Professional liability: Covers design and engineering errors
- Bonding: Protects against contractor default
When evaluating contractors, consider working with established companies that offer professional solar installation services and have a proven track record of quality workmanship and comprehensive insurance coverage.
Warranty Comparison Checklist
Compare these warranty aspects:
- Workmanship warranty length (5-25 years)
- Roof penetration coverage duration
- Response time for warranty claims
- Financial stability of warranty provider
- Transferability to new homeowners
Quality installers often provide comprehensive coverage, including a 25-year workmanship warranty that protects against installation-related issues and ensures long-term system performance.
Special Coverage Scenarios & Solutions
Ground-Mounted and Detached Systems
Ground-mounted solar systems require special consideration due to their classification as “other structures” rather than dwelling coverage.
Other Structures Coverage Limitations
Standard other structures coverage typically provides:
- Coverage limited to 10% of dwelling coverage
- Same perils as dwelling coverage
- Separate deductible may apply
- Replacement cost coverage (if elected for dwelling)
Example limitation: Home insured for $400,000 = $40,000 maximum other structures coverage, which may be insufficient for large ground-mount systems costing $50,000+.
Standalone Solar Insurance Options
Several companies now offer specialized solar insurance:
- Solar Insure: Comprehensive coverage including performance guarantees
- GCube Insurance: Commercial and residential solar coverage
- Renewable Energy Insurance: Specialized renewable energy policies
Typical standalone policy features:
- Coverage for all solar equipment
- Business interruption (lost energy production)
- Equipment breakdown coverage
- Cyber liability for smart inverters
High-Value Solar Systems
Systems exceeding $50,000 often require special coverage considerations.
When Standard Coverage Isn’t Enough
High-value systems may need enhanced coverage for:
- Premium equipment with higher replacement costs
- Complex installation requiring specialized contractors
- Advanced monitoring and control systems
- Battery storage systems
- Electric vehicle charging integration
For homeowners considering comprehensive energy solutions, solar battery storage systems add another layer of complexity to insurance coverage, as these systems often require separate consideration for fire safety and performance protection.
Scheduled Personal Property Endorsements
For valuable solar equipment, consider scheduling items separately:
- Guaranteed replacement cost coverage
- No deductible on scheduled items
- Broader coverage than standard policies
- Coverage for mysterious disappearance
Step-by-Step Action Plan for Homeowners
Before Installation
Insurance Company Notification Requirements
Contact your insurance company before installation to:
- Notify them of your solar plans – Some policies require advance notice
- Obtain coverage confirmation in writing – Don’t rely on verbal assurances
- Determine if policy changes are needed – Coverage limits, endorsements, or exclusions
- Get installation coverage details – What’s covered during the installation process
Before beginning your solar journey, it’s essential to understand the preparation process. Consider reviewing guides on preparing your home for solar panel installation to ensure your property is ready and to minimize potential insurance complications.
Coverage Review Checklist
Review these aspects of your current policy:
- Current dwelling coverage limit
- Other structures coverage amount
- Replacement cost vs. actual cash value
- Deductible amounts
- Excluded perils
- Wind and hail coverage in high-risk areas
Questions to Ask Your Agent
- Are roof-mounted solar panels automatically covered under dwelling coverage?
- Do I need to increase my coverage limits?
- What perils are excluded for solar panels?
- How will my premium change?
- What documentation do you need after installation?
- How are claims handled for solar-related damage?
- Do you offer any discounts for solar installations?
During Installation
Documentation Requirements
Maintain detailed records throughout installation:
- Installation contract and specifications
- Permits and inspection certificates
- Equipment serial numbers and warranties
- Before and after photos of roof condition
- Installer’s insurance certificates
- Final system commissioning report
Temporary Coverage Considerations
During installation, verify coverage for:
- Equipment stored on your property
- Partially installed systems
- Temporary roof openings
- Contractor liability limits
After Installation
Policy Update Procedures
Complete these steps within 30 days of installation:
- Submit final documentation – System specifications, permits, photos
- Update coverage limits if needed – Based on actual system cost
- Confirm coverage effective date – When solar coverage begins
- Update home inventory – Include solar equipment details
- Review updated policy documents – Verify all changes are correct
Annual Coverage Reviews
Review your solar coverage annually for:
- Replacement cost inflation adjustments
- Technology improvements affecting value
- Changes in local installation costs
- New coverage options or discounts
- Claims experience and deductible adjustments
Alternative Insurance Options & Warranties
Solar-Specific Insurance Products
The growing solar market has spawned specialized insurance products designed specifically for solar installations.
Standalone Solar Insurance Providers
Solar Insure
- Comprehensive equipment coverage
- Performance guarantee insurance
- Business interruption coverage
- Typical cost: $200-500 annually
GCube Insurance
- Residential and commercial coverage
- Natural catastrophe protection
- Equipment breakdown coverage
- Cyber liability for smart systems
Renewable Energy Insurance Services
- Specialized renewable energy policies
- Multi-peril coverage options
- Performance-based coverage
- Battery storage inclusion
Cost Analysis and ROI Calculations
Compare standalone vs. homeowners policy coverage:
Homeowners Policy Enhancement:
- Annual cost increase: $180-600
- Coverage: Basic perils only
- Deductible: Same as dwelling ($1,000-5,000)
- Claims: Through existing insurer
Standalone Solar Policy:
- Annual cost: $300-800
- Coverage: Comprehensive, including performance
- Deductible: Often lower ($250-1,000)
- Claims: Specialized solar expertise
Warranty Coverage Integration
Understanding how warranties complement insurance coverage is essential for comprehensive protection.
Equipment Warranties vs. Insurance
Equipment warranties cover:
- Manufacturing defects (25-40 years for panels)
- Inverter failures (10-25 years)
- Performance degradation beyond specified limits
- Premature equipment failure
Insurance covers:
- External damage from weather, theft, accidents
- Sudden and accidental failures
- Liability for damage to others
- Business interruption/lost production
Extended Warranty Options
Consider extended warranties for:
- Inverter protection – Most likely component to fail
- Monitoring system coverage – Protects smart system components
- Labor coverage – Covers replacement labor costs
- Performance guarantees – Ensures energy production levels
Expert Insights & Industry Trends
The solar insurance landscape continues evolving rapidly as the industry matures and insurers gain more experience with solar-related claims.
2025 Industry Trends
Increasing Specialization: More insurers are developing solar-specific expertise and products, moving beyond basic coverage to comprehensive protection including performance guarantees and cyber liability.
Regional Risk Assessment: Insurers are becoming more sophisticated in assessing regional risks, with some markets seeing exclusions for wind and hail damage while others offer discounts for solar installations.
Technology Integration: Smart monitoring systems are beginning to influence insurance pricing, with some insurers offering discounts for systems with real-time monitoring capabilities.
Battery Storage Considerations: As battery storage becomes more common, insurers are developing specific coverage for energy storage systems, including fire suppression and thermal runaway protection.
Future Outlook
Industry experts predict several key developments for 2025-2026:
- Standardized Coverage: More consistent coverage terms across insurers
- Performance-Based Pricing: Premiums based on system monitoring data
- Integrated Warranties: Closer coordination between insurance and warranty coverage
- Regulatory Standardization: State-level requirements for minimum solar coverage
Conclusion & Key Takeaways
Solar panels are generally covered by homeowners insurance, but the devil is in the details. Here are the critical points every solar homeowner should remember:
Essential Action Items
- Contact your insurer before installation – Never assume coverage exists
- Verify adequate coverage limits – Standard policies may be insufficient
- Understand owned vs. leased differences – Coverage responsibilities vary dramatically
- Document everything thoroughly – Proper documentation is crucial for claims
- Review coverage annually – Costs and technology change rapidly
Key Financial Considerations
- Premium increases typically range from $15-200+ monthly
- Replacement costs vary from $14,000-43,000+ for residential systems
- Ground-mounted systems may need separate coverage
- Standalone policies cost $300-800 annually but offer broader protection
Red Flags to Watch For
- Installers without adequate insurance
- Policies excluding wind/hail damage in high-risk areas
- Insufficient coverage limits for system replacement
- Gaps between warranty and insurance coverage
The solar insurance landscape will continue evolving as the industry matures. Stay informed about changes in coverage options, work with experienced professionals, and regularly review your protection to ensure your solar investment remains secure.
For personalized advice about your specific situation, always consult with your insurance agent and consider getting quotes from multiple providers to ensure you’re getting the best coverage for your solar investment.