Are solar panels covered by home insurance?

Before installing a solar panel system, you may want to ask your insurance provider if solar panels are covered by home insurance. 

Once you know how solar panels work, installing them requires a licensed electrician to position the panels and your energy service provider to upgrade or reconfigure your meter. 

As of 1 April 2022, to install solar panels you must: [1]

• Be accredited by the Clean Energy Council

• Hold an unrestricted electrical licence issued by the state or territory authority where the unit was installed and;

• Ensure the components installed are part of the system listed on the Clean Energy Council’s list of approved products including their modules and inverters. 

As part of your installation, you might also want to find out how to fix your solar panels and what type of coverage is available if you ever have an electric or physical issue. For example, it will be useful to look into performance warranties, product warranties and home and contents insurance.

If your solar panels have stopped working (after they’ve been installed) and this is not due to an insured event, your home insurance will not cover you. It would be best to contact your solar system provider and look into its performance warranties that might be available to you.

Generally, solar panels last for up to 25 years [2] but any physical or electrical issues that cause the solar panels to fail or not perform will fall under coverage from the product warranty. 

At Budget Direct, loss or damage to solar systems and solar panels due to an insured event are covered under Home Insurance. We’ll also cover the breakage of a solar panel when you’re a homeowner with Home Building Insurance or you’re a tenant with Contents Insurance.

Adding solar panels to your property is often a significant investment which should also be considered when determining the replacement cost of your home. 

If your solar panels are covered by your insurance, this should also be reflected in your sum insured. The sum insured is the amount needed to repair or replace your home if you make a claim. 

The cost of purchasing and installing solar panels can range from $4,000 up to $20,000, so you may want to review  your nominated sum insured  to ensure it is high enough to cover the full replacement costs of the home and to cover all the potential loss and damage in the aftermath of an insured event. [3]

With Budget Direct, you may also be able to add the optional Sum Insured Safeguard cover to your home insurance policy. This means that we’ll increase your sum insured amount by up to 25% if what you’ve nominated turns out to be not enough to repair or replace your home – including your solar panels.

Solar panels installed in Australian households are subject to potential risks such as fire, rain, hail impact and storms.

With Budget Direct, solar panels can be covered by all of our Home Insurance products. Your solar panels can be covered by Home Building Insurance if an insured event results in loss or damage. Or if you’re a tenant who owns solar panels and you’ve included them in your contents sum insured, then you may be covered under Contents Insurance for insured events causing loss or damage to your solar panels. 

So, whether you’re a landlord with Home Building Insurance, a renter with Contents Insurance or a homeowner with Combined Home and Contents Insurance with Budget Direct, you can protect your investment in solar panels by making sure they’re covered.