How Much Does It Cost To Insure Solar Panels?

The rate insurance carriers will charge is determined by the amount of perceived risk for your home.

Homeowners’ property insurance premiums may be based on the following four factors… These factors be easily remembered in the acronym “COPE”:

1. Construction: How large and what type of construction is your home? Is it brick? Is it wood frame with wood siding? Stucco? Properties cost less to insure if they are built from non-combustible or fire resistant materials… Conversely, wood framed construction is more prone to fire, water and mold damage.
2. Occupancy: Who lives in your home? Are you empty nesters? Or are there kids in your home too…? Does anyone smoke? Is the home a primary residence or is it a vacation home and therefore vacant most of the year? The occupancy, ages and behaviors of the residents in your home have an impact on the insurance premium you pay.
3. Protection: What sort of protection does your home have? Do you have a smoke alarm? If so, is it hard-wired or battery powered…? What about a central station fire alarm that will alert the fire department in the event of a fire? Are there water or moisture detectors in the basement? Homes that have more protection against common causes of loss such as fire and water damage will pay less in insurance premiums than homes without these protections.
4. Exposure: Where is your home located and what is nearby…? Is your home located on the coast near the water? Is it in an area known for high winds or hurricane exposure? How far is your home from the nearest fire hydrant? What about exposure to trees or woods in an areas where wildfires are common? Are floods common where you live? Do you live in a high crime area? Every home has unique value (and unique risks) based on its location, neighborhood, weather and relative exposure to these elements.

All of these factors play a part in the insurance premium for your home (and even other insurance).

However, every home will be priced differently…

1. Homeowner A: A 2,000 square foot wood framed home with no smoke detectors, no fire alarm or burglar alarm that is located on the water in Miami, Florida (occupied only half the year) by a young couple with a large dog – and the husband smokes.
2. Homeowner B: A 2,000 square foot primary residence constructed with insulated concrete forms, with a hard-wired fire alarm and burglar alarm and occupied full time by a middle aged, non-smoking, couple with no pets in Saratoga Springs, NY.

Homeowner B is likely to pay less for insurance because the “Construction” is more resilient, the “Occupancy” is occupied by non-smokers year round, as opposed to vacant, the “Protection” shows they have invested in technology to protect the home and the “Exposure” indicates they’re not in a potentially hazardous, high wind zone.