Consider insuring your solar equipment

With load shedding making an unwelcome return and electricity tariffs continuing to rise, perhaps it's time to consider insuring your solar and inverters. 

Whether you are installing an alternative energy solution for the first time or expanding your existing setup, now is the time to review your insurance policy to make sure your equipment is covered. 

That’s according to Ernest North, co-founder of Naked insurance, who says households are investing in alternative power sources to manage rising costs and reduce their reliance on the national grid. New rules that will allow customers to be compensated for feeding excess power into the grid are likely to accelerate this trend.

“However, alternative energy sources don’t come cheap, once you add up purchase and installation costs,” said North. “That’s why it’s important to review your insurance cover to ensure expensive equipment such as solar panels, inverters, batteries and generators is protected from the risk of steep financial losses.”

For homeowners considering making the move to solar, however, reports of faulty equipment and dangerous installations causing damage are a cause for concern. 

This is not a concern to take lightly, as evidenced in the warning issued by the Consumer Goods and Services Ombudsman, which noted a rise in the number of complaints about solar systems and generators.

Head of personal products at Standard Bank Insurance, Hardy Ncube, said insurers have also started to see a rise in unqualified and inexperienced solar installers leaving households with a power solution that doesn’t work, structural damage to the home due to defective design and workmanship or costly repairs that are not covered by homeowners’ insurance policies.

"In the absence of legal requirements to become a solar installer, it’s essential that consumers do their homework before choosing a supplier to ensure that the job is completed properly, safely and securely by a reputable and legitimate solar provider."

Ncube said it’s important to note that, as with other areas in the home, insurers do not cover faulty equipment, defective design or non-compliant installation including damage to the home resulting from such. 

"To ensure this is not the case, your insurer will typically ask you to provide an invoice detailing the brand, size, type and number of solar panels, inverters and batteries; an electrical certificate of compliance as required by regulation; municipal approval where required; and sometimes a structural engineer’s certificate to ensure the structural soundness of the installation [i.e. the condition of the roof and its ability to carry the weight of the solar panels].  

Both Ncube and North agree that it is important for consumers to get a reputable and accredited installer. "We recommend that consumers conduct online searches of each installer and assess reviews of their services by previous clients before turning to the more technical qualification checks,” said Ncube.

In response to the problem of non-compliant installations, the SA Photovoltaic Industry Association (SAPVIA) reviewed its current registration system and created the PV Green Card assessment as a form of accreditation that separates qualified and trained installers from the so-called bakkie brigade – installers who claim to do the job but use components that have not been certified or that don’t have proper warranties.

North said with theft and risk so high, it was important to be insured.

"Without the right cover, homeowners could face significant financial losses if their solar panels are stolen. Weather damage from storms and wind are also major hazards for rooftop solar. Fire risks are a growing concern. Inverters and lithium-ion batteries, if not installed correctly or properly ventilated, pose a serious fire hazard. Many insurers require compliance certificates and specific safety measures to ensure coverage in case of damage caused by overheating or electrical faults," said North.

Tips to ensure you get the right insurance

Buildings vs contents insurance – getting it right

To ensure that your alternative power solutions are properly covered, it’s essential to understand whether they fall under buildings or contents insurance:

Buildings insurance: If a power solution system is permanently affixed to the property, it should be covered under your buildings insurance. This includes solar panels, geysers, inverters, and batteries wired into the home’s electrical system. Similarly, if a generator is housed in a fixed enclosure, it is considered part of the property.

Contents insurance: Portable power sources such as standalone inverters, generators, and batteries that can be unplugged and moved should be covered under home contents insurance. It is important to insure solar panels, inverters, and batteries for their replacement value – including installation and inflation – not just their original purchase price.

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