There is an unending debate among homeowners as to whether installing solar panels will increase or decrease home insurance rates. Both sides of the divide are right because the effect of solar panels on home insurance rates depends on several factors. Here are three important examples of those factors:

The Policy of the Insurance Company 

Insurance companies approach the issue of solar panel installation in different ways. On one side, there are a few companies that offer discounts to homeowners who install solar panels. They rationalize their actions by claiming that homeowners who install solar panels are environmentally conscious. This is significant to these insurers because those who are environmentally conscious tend to be careful, which means their houses incur fewer damages.

On the other side of the divide are insurance companies that increase rates for home owners who install solar panels. They base their decisions on the fact that solar panels are expensive, and expensive additions to a home lead to increased coverage rates.

The Nature of the Installer

Some companies increase rates for homeowners who install solar panels, not because of the cost of the panels, but because the installation can damage the roof. It's not that solar panel installation is inherently dangerous; it's just that there is a great risk for damage if the installation is handled by an unskilled person. What's more, the damage may start out small and remain unseen for months or even years. This is why your insurance company will require you to use the services of a professional and certified installer for the work.

The Local Climate

On the surface, it is not apparent why the climate of an area should affect the cost of insuring houses with solar panels. The reason becomes clearer once you understand how solar panels can become damaged or cause damage to the roof when affected by weather elements. For example, installing solar panels in an area that experiences frequent storms may result in increased rates of home insurance. The risk of the roof (and with it the panels) getting damaged by the storms is just too high for most insurance companies to ignore.

If you are planning to install solar panels on your roof, it's a good idea to consult your home insurance carrier to get its position on solar panel installations. In some cases, it might even be cheaper to switch insurance carriers; seek insurance quotes to confirm if this is the case. For more information, you can also check out websites like