Solar panels and home insurance: A sunshine coverage check

About five million Americans have installed solar panels on their roof, and for good reason. Investing in a solar energy system not only helps you live more sustainably, but it will also save you tens of thousands of dollars on energy bills as long as you live in your home.

There is one small cost increase you should plan for, however—a slight hike to your annual home insurance premium. That's because installing solar panels increases the value of your home, which means that your premium will also increase a little bit, too. While it will depend on what state you live in and the specifics of your property, most homeowners can expect to see their insurance premium increase anywhere from as little as a few extra dollars a month to a few hundred dollars a month after installing solar panels.

Here's what you need to know about how to make sure your solar panels are covered under your home insurance policy and how to make sure you're paying the right price for the right coverage.

Once a rooftop solar panel system is installed on your home, it's generally considered a part of your home under most home insurance plans. However, it's important to alert your insurer about any changes you want to make to your property to confirm your existing policy will cover that change.

In some cases, if you make a change to your property without notifying your insurance company, it can void your coverage. Call and confirm your company will approve adding solar panels to your coverage, and if they will approve a coverage limit increase if necessary.

But, while your home insurance likely covers your solar panels, there are a few things to keep in mind:

Location matters: rooftop vs. ground-mounted systems

Rooftop solar panels are typically covered under your standard homeowners policy as part of your dwelling coverage, since they're considered a permanent attachment to your home.

However, ground-mounted solar panels and solar panel carports may require additional coverage since they're not attached to your home's structure. Ground-mounted solar panels may be covered under your other structures coverage as well, but you should verify this with your insurer.

You may need to increase your coverage

Solar panels may increase your homeowners insurance costs depending on your current policy's coverage limit and if you choose to update it. Your insurance policy's coverage limit is the maximum amount it will pay for a covered loss. Since solar systems cost $29,649 on average in 2025, you may want to talk to your insurer about raising your coverage limit to ensure you're fully protected.

Your insurance premium will likely stay the same if the replacement value of your home with solar panels remains under your coverage limit. Your insurance premium can increase if solar panels increase the replacement value of your home enough to exceed your coverage limit and you decide to adjust your coverage amount.

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 as much as a few hundred dollars a month.

Installation and workmanship coverage

When you call to confirm that your insurer covers solar panels, ask about whether the coverage extends to the installation process. Qualified solar installers often offer a workmanship warranty that will cover you in the unlikely event that there's damage to your roof or solar panels due to the installation process. But it's always smart to ask if your home insurance policy will also cover installation-phase damage to your solar panels should any occur.

Owned vs. leased solar panels

Whether you buy or lease your solar panels can make a difference in your policy. If you install a system with a lease or power purchase agreement (PPA), you are not technically the system owner—the company with whom you have the agreement owns the panels and is responsible for maintaining them. This typically comes with the benefit of not needing to worry about your home insurance covering solar panels. However, you should closely review any lease or PPA before you sign to understand coverage responsibilities and ensure adequate protection for your home.

Most homeowners insurance policies cover solar panels against common issues like:

• Fire damage

• Wind and hail damage ( some insurance policies may exclude coverage for solar panel damage caused by wind or hail)

• Lightning strikes

• Theft and vandalism

• Falling objects (such as tree branches)

Coverage typically doesn’t include:

• Wear and tear or normal aging

• Maintenance issues

• Performance problems or energy production shortfalls

• Manufacturer defects (usually covered by equipment warranties instead)

Regional considerations

Where you live is a significant consideration when selecting the level of homeowners insurance you need and what is covered. For example:

• Southwest regions: Lower hail risk but higher exposure to extreme heat

• Midwest: Higher tornado and hail risk requiring adequate wind coverage

• Coastal areas: Hurricane and storm surge considerations

• Earthquake-prone regions: May need additional earthquake coverage for solar systems

Before installation:

1. Contact your insurance company to discuss your solar plans

2. Review your current coverage limits and dwelling coverage amount

3. Ask about any exclusions specific to solar panels

4. Get quotes for any necessary coverage adjustments

After installation:

1. Notify your insurer about the completed installation

2. Provide documentation of the system cost and installation details

3. Update your coverage limits if needed

4. Review your policy annually to ensure adequate protection

Solar panels generally require very little upkeep and maintenance. Panel manufacturers test their products in real-life conditions and verify they can withstand the usual wear and tear and more extreme weather events like high winds, hail, and heavy snow.

Your solar equipment should also come with warranties that range in terms and conditions; getting a strong solar panel warranty helps ensure that your system will produce clean, emissions-free electricity for decades.

Regardless of these warranties, at the end of the day, solar panels are usually covered by homeowners insurance, and any premium increases are usually modest compared to the long-term energy savings. The average U.S. homeowner saves between $37,000 and $148,000 over 25 years on electricity with solar. Even with potential insurance adjustments, solar remains an excellent investment. The key is communication with your insurance provider before installation to ensure you have adequate coverage and understand any policy changes.