Solar panel insurance: Are solar panels covered by home insurance?

With more homes installing solar panels than ever before, it’s vital for homeowners to understand the ins and outs of solar panel insurance in Australia. Whether you’ve already made the switch to solar or are doing your research before buying a solar system, we’re here to help answer your questions about ensuring your solar investment is financially covered should anything happen.

Like any large investment, having peace of mind is essential, which begs the question: are solar panels covered by home insurance? And if so, to what extent? We’ll explain why looking into this is so important, and whether insurers generally cover damage caused by weather events such as storms, floods or fires. We’ll also discuss why you may have to pay more for cover, depending on where you live.

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Are solar panels covered by home insurance?

Most standard home and contents insurance policies do cover solar panels, but it’s important to check your policy includes it. Home and contents insurance policies generally cover your actual solar panels as well as any related equipment, such as your inverter or solar battery unit.

However, it’s worth noting that some policies may not cover damage caused by certain weather events, and any additional coverage may be required for these circumstances. Always review the fine print with your insurer to make sure you have adequate coverage for your solar panel investment. ‘Fine print’, when it comes to home and contents insurance, means reading the Product Disclosure Statement, not just the summary of your policy that usually accompanies it.

Can you add solar panels to a home insurance policy?

You can add solar panels to your home insurance policy but adding solar panel coverage to a home insurance policy will usually always come at an additional cost. You’ll need to update your ‘sum insured’, which is the maximum amount of money an insurance provider is obligated to pay in the event of a covered loss. Although there’ll likely be a slight increase to your premium, adding your solar system to your policy will account for additional spending you’ve made on installing them.

It’s essential to research your options and speak to your insurer, and potentially other insurers, to find the best cover and policy cost for your needs, budget and risk appetite. Ultimately, the peace of mind that comes with having solar panels covered by your home and contents insurance policy is worth the extra investment if you can afford it, especially in Australia where extreme weather events are expected in many locations.

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What does home and contents insurance actually cover?

Home and contents insurance typically covers you for damage to your home and the contents inside. That usually means not just your house but the structures around it, such as garden sheds, pool fences and carports. It might be easiest to think that ‘home’ covers permanent structures and fittings, while ‘contents’ covers the items that aren’t permanently attached to the home, which can extend to items outside your home but within your property boundaries – a lawn mower stored in your shed is an example of an item that could be covered by home and contents insurance.
In case of any unforeseen circumstances, such as fire, flood, storm or hail damage, your insurance policy should cover the repair or replacement costs up to the sum insured amount outlined in the PDS.

The sum insured amount can be the replacement cost or the market value of the repair cost, depending on the policy and the insurer. You often can elect to be paid either the replacement cost or the market cost of an item, depending on your policy terms.

Again, it’s worthwhile reading the PDS to ensure you know exactly what you’re covered for because what constitutes ‘home and contents’ and what type of sum insured your covered for may vary.

Do I need extra insurance cover for my solar panels based on where I live?

If you live in an area that is prone to weather events such bushfires, cyclones or flooding, you may be hit with a higher home insurance premium regardless of whether you have a solar system. The Australian Competition and Consumer Commission found that householders in northern Australia were paying higher premiums on average than other parts of the country.

Depending on the location of your property, the potential risks it faces and the items you want to cover – including your solar system – make sure you talk to multiple insurers about how much your home insurance may cost.

Any advice on this page is general and has not taken into account your objectives, financial situation or needs. It is not personal advice. Consider whether this general advice is right for your personal circumstances. You may need advice from a qualified adviser. Canstar Blue is not providing a recommendation for your individual circumstances. If you decide to apply for an insurance policy, you will deal directly with the provider, not with Canstar Blue.

Canstar Blue is a comparison website, not a product issuer, so it’s important to check any product information directly with the provider. Any company listed may use or be used by another company to arrange, issue, distribute or sell its insurance policies to customers. Consider the Product Disclosure Statement (PDS), Target Market Determination (TMD) and other applicable product documentation before making a decision to purchase, acquire, invest in or apply for a financial or credit product. Contact the product issuer directly for a copy of the PDS, TMD and other documentation.

If you are seeking to replace an insurance policy, you should consider your personal circumstances, including continuing the existing cover until the replacement policy is issued and cover confirmed. Your current policy may have different features to products currently on the market. Please consider what features are right for you when comparing insurance products and refer to the provider for further details on a policy.