Solar Panels & Insurance Fails

I have a few hobbies in addition to content creation: bird watching, traveling, puzzles, and my favorite, seeing people complain in various comment sections of the internet. It’s the virtual equivalent of peeking out the window when your neighbors are fighting.

This week, I was on the Nextdoor app. If you’re not familiar with Nextdoor, it’s an app where people post about local yard sales and complain about someone who painted their house purple. Now that we are in the midst of Summer, the topic of the week was solar panels. Most people don’t like them for a few reasons:

·       They’re ugly

·       They’re expensive

·       They make it hard to sell your house

·       Frequent acquisitions make it hard to keep track of who actually owns the lease

And while these complaints are specific to residences, I’d like to talk about solar panel pain points when it comes to commercial insurance.

1.       Don’t assume the leasing company will cover damage to the panels. Yes, I understand that this is a lease, and you don’t own the panels, but you would be surprised at the types of exclusions I typically see when it comes to coverage and replacement of solar panels. The leasing company may exclude damage from vandalism, natural disasters or theft.

2.       Don’t forget to include them on your Schedule of Values (SOV). If the leasing agreement indicates that YOU are responsible for damage due to vandalism, and you forget to include the solar panels on your SOV, your commercial property policy likely will not cover the loss.

3.       Review all Solar Panel lease agreements. If you are a Risk Manager, you probably provided a list of insurance requirements for your procurement department to refer to when reviewing contracts, but due to the nature of Solar Panel lease agreements, I would recommend sending these agreements to your broker for review to make sure you have the appropriate coverage before you sign on the dotted line.

Hope these tips save you from the headache of finding out damage or replacement of solar panels isn’t covered. Too bad I can’t save you from neighbors who paint their houses purple.