Insuring Solar Panels: A Must-Read Guide for South African Homeowners and Complexes

The recent announcement by South Africa’s Finance Minister, Enoch Godongwana, introduced a rebate scheme for new rooftop solar installations on private homes, effective from March 1, 2023. This initiative has significantly boosted the interest in renewable energy solutions, especially solar panel installations. However, it has also raised concerns and confusion among body corporates and homeowners associations (HOAs) about the right insurance coverage for these installations.

Several insurance options are available for body corporates and HOAs. These include:

1. Increasing the building sum insured.
2. Adjusting the power-surge and exterior theft first-loss limit.
3. Specifying the solar system as an additional item with an extra premium.

It’s crucial for homeowners, body corporates, and HOAs to ensure that solar systems are installed by accredited professionals. This is to avoid potential claims rejections by insurance companies and manufacturers and to maintain adequate coverage for solar installations.

Hermanus van der Linde, the CEO of short-term insurance broker Integrisure, highlighted that many body corporates and HOAs are either unaware or have not been informed that they can include solar panels in their existing building insurance policies with minimal repercussions. Some associations, however, are hesitant to insure the installations, leaving individual homeowners to secure coverage.

Van der Linde also emphasized the importance of discussing insurance matters at upcoming AGMs to ensure that members are well-informed about the coverage provided for solar panels, any exclusions, and potential limitations.

Key Insights:

1. Rising Demand for Solar Installations: The National Treasury’s rebate scheme has significantly boosted the demand for rooftop solar installations in South Africa.
2. Insurance Options: There are several insurance options available for body corporates and HOAs, ensuring that solar installations are adequately covered.
3. Importance of Accredited Installation: It’s crucial to have solar systems installed by accredited professionals to avoid potential claims rejections and ensure adequate coverage.
4. Stolen or Damaged Solar Panels: One of the challenges faced by South African homeowners with solar installations is the theft or damage of solar panels. When this happens, the panels must be replaced with similar technology models. Otherwise, homeowners might need to replace the entire system.
5. Municipal Approval: As many South Africans are transitioning to alternative power supply systems, municipalities have highlighted potential fire risks. It’s crucial for homeowners to ensure their solar installations have municipal approval to avoid potential issues with insurance claims.
6. Insurance Claims: Insurance companies and manufacturers might reject claims if the solar system is not installed by an accredited professional. It’s essential for homeowners to work with reputable solar installers who can provide the necessary certifications and have adequate liability coverage.