Home insurance and solar panels

Is it worth getting solar panels?

Around one million home rooftops in the UK now feature solar technology^[1] - as more of us look at ways to reduce our carbon footprint.

Installing solar panels can comes with quite a hefty initial investment,  anywhere from around £1,000 to £10,000, but they will save you money on energy bills. So, you should more than recoup your costs in the long run and it can add value to your home.

As an added advantage, you can get paid for any surplus energy you don’t use by sending it into the national grid.

How long do solar panels last?

Solar panels have a performance warranty typically around 25 years before they start to degrade and lose some of their ability to absorb sunlight.

As technology has advanced, the latest solar panels are expected to last much longer - between 30 to 50 years.

Are all types of solar panels covered by home insurance?

You should always check with your policy provider. In general, most rooftop solar energy systems are covered as standard by your home buildings insurance policy, including:

• Photovoltaic (PV) monocrystalline panels
• PV polycrystalline panels
• Hybrid PV panels with heat exchangers
• Thin-film solar panels
• Solar roof tiles

That’s because they’re considered a permanent fixture and fitting of your property.

Policies differ but mostly your panels will be covered for things like weather damage, fire, falling trees, subsidence, theft or vandalism.

If you have free-standing, ground-mounted solar panels that aren’t attached to your home, they probably won’t be covered by your buildings policy. If this is the case, you’d need to get an add-on or separate specialist solar panel insurance policy.

How might solar panels affect my home insurance?

Your home buildings insurance should insure solar panels as standard. In some cases you could see a small increase in policy costs. Insurance companies will consider the following:

The cost of the solar panels

Although prices have dropped in recent years, solar panels are still pricey. Your provider will take into account the cost of replacing the panels should anything happen to them.

The value of your home

Adding solar panels to your home can make it more energy-efficient and eco-friendly. These are credentials that tend to make a home more desirable for buyers.

In terms of insurance, an increase in the value of your home can cause your premiums to go up slightly.

Classing your home as a place of business

In very rare cases, if you’re selling your surplus solar electricity to the national grid via the government’s old feed in tariff scheme or the new Smart Export Guarantee (SEG), an insurer may class your home as a place of business and won’t cover you for home insurance as a result. If this happens, you should look at swapping to an alternative insurer.

Can I have separate insurance for my solar panels?

Your buildings insurance policy will usually include cover for your solar panels. If you contact your insurer and find they aren’t covered as standard, you can ask to add them to your policy. This might incur a small additional cost.

If I get solar panels, do I need to inform my insurance provider?

Installing solar panels is classed as a major change to your home, so it’s always worth letting your insurer know about it to be certain you’re adequately covered.

Solar panels will increase your home’s rebuild value. So you should check that your buildings insurance cover is enough to meet the new, higher rebuild costs.

Will my insurance cover accidental damage to the solar panels?

It’s important to check this with your policy provider because, though many do cover it, some don’t.

If your panels aren’t covered for this type of event, it could be worth looking at taking out additional accidental damage cover.

What about wear and tear?

Almost all insurers won’t cover solar panels for wear and tear.

Can I get paid for having solar panels?

Yes, you can get paid for supplying the national grid with any surplus power your solar panels generate.

(SEG) is a government-backed initiative launched on 1 January 2020 and replaces the feed-in tariff which closed to new participants in March 2019.

Under the SEG scheme, you get paid by an electricity supplier for every kilowatt hour (kWh) of renewable electricity you send to the grid.

Different suppliers can set different rates of payment per kWh and can change their offering, so it’s worth shopping around for the best tariff and to review tariff options on a regular basis.

Solar Energy UK regularly updates its league table to show which suppliers are offering the best rates.