Q: Are solar panels installed on the insured's roof covered for windstorm peril under the ISO HO 00 03 homeowners insurance policy?

Response 1: The ISO HO 00 03 policy is open peril coverage, subject to exclusions, on the dwelling. So yes, windstorm is covered. In some coastal areas, carriers will add a windstorm exclusion to the policy by endorsement, and the insured then needs to purchase coverage through a subsidized pool program—so make sure that is not the case.

The policy states:

1. We cover:

1. The dwelling on the “residence premises" shown in the Declarations, including structures attached to the dwelling;

If the solar panels are attached to the dwelling, they become covered as part of the dwelling—meaning that windstorm is covered.

However, any loss will be paid at actual cash value, not replacement cost. Section 1 – Conditions, D, states that actual cash value applies to the following:

1. Property of the following types:
   
   b. Awnings, carpeting, household appliances, outdoor antennas and outdoor equipment, whether or not attached to buildings.

You may want to check with your carrier to see if there is an endorsement available to buy this back to replacement cost.

Response 2: As long as the panels are mounted and installed on the roof, and as long as the panels are owned by the homeowner—not leased—they should be covered for the windstorm peril. However, many insurers exclude or limit coverage for these so read the full policy.

Response 3: A solar panel that is attached to the house becomes a part of the house and is covered for all the same perils as the house. An ISO HO3 should also cover solar panels that aren't attached and would be considered personal property. I've heard there are insurers limiting coverage for them but have yet to see any policies that do. 

Response 4: The panels themselves certainly are, just like other parts of the building such as windows and doors, for instance. I'm not familiar with the hookup, but if there are electronic components, they're subject to the same exclusions and limitations as other electronic and electrical gear. Special coverage for equipment breakdown might be needed for that. You'd need to understand what those components are and how they might be damaged.

Response 5: Windstorm is a covered peril for both dwelling and personal property with no limitation for solar panels. I mention both coverages because arguments have been made for both coverages applying and insurers taking different positions as to whether they are dwelling or personal property. Since this is an HO3, the perils differ.

Response 6: The HO3 includes structures attached to the dwelling. The solar panels would qualify as a structure attached to the dwelling, so the covered property element is resolved.

However, if faulty, inadequate or defective design, construction, maintenance or materials contributed to the claim, the anti-concurrent causation exclusion in Section I – Exclusions, B could apply.

3. Faulty, inadequate or defective:

a. Planning, zoning, development, surveying, siting;

b. Design, specifications, workmanship, repair, construction, renovation,

remodeling, grading, compaction;

c. Materials used in repair, construction, renovation or remodeling; or

d. Maintenance; of part or all of any property whether on or off the "residence

premises".

This question was originally submitted by an agent through the Big “I" Virtual University's (VU) Ask an Expert service, with responses curated from multiple VU faculty members. Answers to other coverage questions are available on the VU website. If you need help accessing the website, request login information.

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