Some Insurers Dropping Owners Who Install Solar Panels

seminole97

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Coincidentally, myself and two of my staff had to find new insurers in the last six months. Not for having solar panels, just companies reducing exposure in FL.
I had a new roof put on last March, but I found the insurers different excuses to cancel policies interesting:


Homeowners adding solar panels study energy savings and break-even costs, but they should also call their insurer: Some increase premiums and some cancel policies.

FORT LAUDERDALE, Fla. – As electric bills surge and the federal government offers generous tax incentives for renewable energy investments, more and more Florida homeowners are seriously considering rooftop solar systems.
But in calculating system costs vs. electric bill savings, many would-be solar owners are neglecting to consider how a solar system will affect their home insurance bill – or how difficult it might be to find a company that will insure them at all.
And with insurance premiums skyrocketing for all Florida homeowners, solar customers who can obtain coverage might also find that the price increase will wipe out any energy-cost savings they expected from going solar.
“It’s a big deal and a lot of folks don’t realize that many carriers don’t accept solar panels,” says Dulce Suarez-Resnick, vice president at the Miami-based agency Acentria Insurance.
Oakland Park homeowner Holy Strawbridge learned this the hard way. She installed a modest 8,000 kilowatt system atop her home about two years ago and recently signed up for coverage with Edison Insurance Company. After the insurer sent an inspector to her home, she received a letter canceling her entire policy.
“I was shocked,” Strawbridge said. “I’ve never filed an insurance claim and I’ve lived in this house since 2001.”
The reasons cited in the cancellation letter sent by Edison: Her solar panels are ineligible for coverage due to the age of her roof (11 years) and because she has a tile roof.
Those aren’t the only reasons insurers won’t cover rooftop solar systems, according to interviews with solar installers, solar energy advocates, and insurance agents. Insurers who do business in Florida offer a wide variety of reasons for refusing to insure homes with them.

Net metering flagged by insurers

Increasingly, insurers are claiming that solar systems with net metering connections to utilities – which is virtually all of them in Florida – pose a unique risk of injury to line workers and damage to the utility grid.
Florida Power & Light’s net metering contract requires homeowners to take responsibility for all potential damages, says Ryan Papy, president of Palmetto Bay-based Keyes Insurance. “So if there’s a surge running through your panels that causes damage to the grid or other homes, the client is responsible.”
Solar installers and advocates call that justification unfounded. They say all equipment used to connect rooftop solar systems to the grid comply with state building and electrical codes and are inspected by utilities before new systems are activated. Utilities also have authority to come onto solar owners’ properties and disconnect them if they suspect any safety issues, they say.
Solar advocates wonder if the net metering concerns are just excuse insurers are giving to justify dropping customers.
Many insurers who operate in Florida, faced with mounting losses, have been dropping or nonrenewing policies to reduce the amount of overall risk they carry on their books of business. In some cases, state insurance regulators have ordered insurers to shed policies so they can afford to purchase reinsurance – insurance that insurers must carry to be able to pay all claims after a catastrophe.
Justin Hoysradt, president of Vinyasun, a solar installation company based in West Palm Beach, says the potential dangers of backfeeding are exaggerated. Since 2006, all power-producing inverters have complied with an electrical standard called U.L. 1741, Hoysradt said. This standard requires solar system inverters to be able to detect utility outages or any odd voltage disruption and automatically disconnect the solar systems from the grid.
Hoysradt says he is unaware of any documented instance of injury or damage from a properly installed UL 1741-certified inverter. The cut-off technology is so dependable that utilities recently removed a requirement that solar systems be equipped with separate redundant manual lockable disconnects, he said.
Until about a year ago, Hoysradt rarely heard customers complain that they couldn’t find or keep insurance because of their solar systems. Now, at least one potential customer a day says their insurer could not guarantee they wouldn’t be dropped if they install solar, he said.
Other insurers have told homeowners that net metering turns them into commercial utilities and they are no longer eligible for homeowner insurance policies, said Heaven Campbell, Florida program directors for Solar United Neighbors, a nationwide nonprofit that helps solar customers form co-ops to secure better pricing. Campbell says her organization has documented about 60 homeowner complaints over the past year. They either say they’ve been cancelled after installing solar panels or told they would no longer be eligible for coverage if they install panels, she said.

 

seminole97

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Insurer cites numerous concerns

Olympus Insurance laid out an extensive list of concerns about property and liability exposures in a 2020 filing with the Office of Insurance Regulation, while seeking approval to exclude solar systems from the risks it must cover. They included increased exposure for damage due to wind uplift when solar panels are attached to a roof, increased exposure for wind or hail damage to the solar system itself, fire hazards from loose or poorly connected parts or wires, increased risk or electrocution, presence of toxic materials and byproducts of the panels themselves, and potential liability associated with backfeeding to the grid.
Without commenting on the validity of the concerns, the Office of Insurance Regulation told Olympus it could not allow a broad mandatory exclusion for coverage of solar unless the company provided an option for solar owners to “buy back” the coverage at an increased price. Olympus withdrew the filing. It could not be immediately determined from the office’s filing database whether the company resubmitted it with the buy-back option.
Campbell disputes claims that rooftop solar systems make roofs more susceptible to wind uplift during hurricanes. She said after Hurricane Michael struck the Panhandle in October 2018, many roofs with solar panels remained intact amid roofs without solar panels that were destroyed.
Solar United Neighbors’ website contains numerous photos of installations that held up in storms that damaged roofs of surrounding homes. Campbell says modern building codes actually make roofs with solar panels better able to withstand winds.
Paul Handerhan, president of the consumer focused Federal Association for Insurance Reform, said concerns about wind uplift stem from the potential for increased damage if solar panels and roofs are torn from homes together.
Suarez-Resnick concurs: “With stronger winds like a Category 3 hurricane, you might have much more damage if panels go flying and land on your neighbor’s roof or car.”
Companies that do insure rooftop solar systems are allowed to set strict conditions for that coverage, filings show.
Edison, the company that cancelled Strawbridge’s policy, will only cover homes with solar systems that were installed after 2016, on shingle or metal roofs no older than 10 years, on flat roofs no older than five years, and produce no more 10 kilowatts of electricity, which is more or less the typical rooftop system capacity.
As Strawbridge found out, Edison will not insure solar systems mounted on clay or tile roofs. Stacey Giulianti, chief legal officer at Florida Peninsula Insurance Company, parent company of Edison, said, “We chose not to insure solar panels on tile roof homes due to the challenges presented by the attachment of the panels to the roofs. Most tile roof installations require attachment brackets which must pierce the tile roofs.”
Solar panels are routinely installed without piercing tiles, Hoysradt said. Many installers remove clay tiles at the point where solar posts attach to the roof and replace them with aluminum tiles that won’t break or crack when drilled.
Hoysradt noted that state licensing requirements for solar installers require knowledge of roofing, electrical and plumbing construction. “We’re not just a bunch of people taking roofs apart with no experience,” he said. “There’s no reason for insurance carriers to not cover solar on a tile roof.”
Nevertheless, rooftop solar consumers can expect to find a hodgepodge of insurance rules unless and until the state Legislature decides to enact common coverage standards.

Common standards for insuring solar?

The national trade organization Solar Energy Industries Association is working with fellow solar advocacy groups Florida SEIA, Solar United Neighbors and Vote Solar to reach out to insurers and try to develop legislation to eliminate confusion about insurance practices, said Will Giese, the association’s Southeast regional director.
The good news for Strawbridge and other solar owners is there are insurers that do not prohibit coverage of homes with solar systems or impose a long list of restrictions on coverage. They include state-owned Citizens Property Insurance Corp., the so-called “insurer of last resort.”
Citizens covers solar systems as part of the structure. No special endorsements or add-ons are required, spokesman Michael Peltier said. “They would just be added into the replacement value of the home,” he said. Of course, adding solar panels increases the value of a home, so homeowners can expect to pay a higher premium when they add solar.
One mistake a homeowner should never make: Installing a solar system without checking insurance options, Suarez-Resnick said. An agent can tell you whether your roof is nearing the end of its life and should be replaced first. It’s a pain to find new insurance, and it’s costly to remove and replace solar panels because Citizens or another insurer demands that you get a new roof.
Or you might look for a solar installer, like Universal Contracting and Solar, that specializes in bundling roof replacements and solar installations. You can get long-term financing and qualify for the 30% federal tax credit to offset cost of the combined job, says Jenifer Kempka, the company’s director of business development.
“Right now is the best time to go solar,” she said.
 

bagdropper

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So is this a Florida only thing, or other states/insurers doing this also?
 

seminole97

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So is this a Florida only thing, or other states/insurers doing this also?
This was from Floridarealtors.org, hence the focus, but I posted it here hoping those on the board that work in the industry could provide more info.
 

ericram

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So is this a Florida only thing, or other states/insurers doing this also?
Well the homeowners insurance issue in Florida goes beyond this. We currently have one of the highest rates in the country and companies are dropping homeowners left and right so it's fitting that they will find another way to no longer insure Florida homeowners.
 

The Tradition

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Well the homeowners insurance issue in Florida goes beyond this. We currently have one of the highest rates in the country and companies are dropping homeowners left and right so it's fitting that they will find another way to no longer insure Florida homeowners.

It's because the reinsurers have bought into all the climate change crapola, and primary insurers can't operate without reinsurance.
 

bagdropper

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This was from Floridarealtors.org, hence the focus, but I posted it here hoping those on the board that work in the industry could provide more info.

Well the homeowners insurance issue in Florida goes beyond this. We currently have one of the highest rates in the country and companies are dropping homeowners left and right so it's fitting that they will find another way to no longer insure Florida homeowners.

Thanks for the replies, gentlemen.

One issue I had a few years back was insuring my cabin - the "company lines" I got why I couldn't insure it with them was nobody was living year round in the dwelling. And in NE Iowa along the river, this is an issue that has begin only recently (Maybe last 10 or so years).

Every vacation home in my little hamlet has the same insurer...only one we could find. The funny thing is, not one of us 7 has had a claim in roughly 20 years, yet insurance is very tough to find.
 

St. Louis Hawk

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It's because the reinsurers have bought into all the climate change crapola, and primary insurers can't operate without reinsurance.

Well, if one thing is true in this world, it's that insurance companies listen to the media and don't do any financial analysis of risk. Just back of the envelope and gut feelings at best.
 

ericram

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Thanks for the replies, gentlemen.

One issue I had a few years back was insuring my cabin - the "company lines" I got why I couldn't insure it with them was nobody was living year round in the dwelling. And in NE Iowa along the river, this is an issue that has begin only recently (Maybe last 10 or so years).

Every vacation home in my little hamlet has the same insurer...only one we could find. The funny thing is, not one of us 7 has had a claim in roughly 20 years, yet insurance is very tough to find.
We have a vacation rental in Inlet Beach FL. We closed on it in February. We are on our 2 homeowners insurance. Paying more of course. I fear what our house in Tallahassee will be next renewal period. Some are saying as much as 40% more.
 

seminole97

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We have a vacation rental in Inlet Beach FL. We closed on it in February. We are on our 2 homeowners insurance. Paying more of course. I fear what our house in Tallahassee will be next renewal period. Some are saying as much as 40% more.
I think mine was about 10% more with a new company. Happened as I was working a refinance, so after the changes my mortgage/taxes/ins overall was still lower than before.
 
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They mention losses - what are those from? Hasn’t it been a quiet few years where insurance companies could build up reserves?
 

Hawki97

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Well, if one thing is true in this world, it's that insurance companies listen to the media and don't do any financial analysis of risk. Just back of the envelope and gut feelings at best.

Oh Trad…

laughing-haha.gif
 

joelbc1

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you can’t always get what you want!
We have decided last week about “going solar”….We called out home owners who in turn called their underwriters….Our insurance folks answered by saying the “cost of the panels will be added to our roof“ and insured no problems.
I think this has to do with insurerers wanting to avoid “high risk” Florida p[roperties more than any other concerns. Bankers and insurers like your money….and they really like it when it is risk free.
 

The Tradition

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Well, if one thing is true in this world, it's that insurance companies listen to the media and don't do any financial analysis of risk. Just back of the envelope and gut feelings at best.

Why would Florida be any riskier than Texas, Louisiana, or the Carolinas? I realize there's nothing of value in Mississippi and Alabama. Nothing on the Georgia coast either, except for Savannah.

The Outer Banks will be gone if a true monster hits them.
 

Hawki97

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Why would Florida be any riskier than Texas, Louisiana, or the Carolinas? I realize there's nothing of value in Mississippi and Alabama. Nothing on the Georgia coast either, except for Savannah.

The Outer Banks will be gone if a true monster hits them.

I don’t know. But I’ll bet dollars to donuts the statisticians, actuaries, and data scientists at insurance companies know better than a middling HR manager at a nursing home conglomerate.
 

ThorneStockton

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Saw this story the other day with the announcement that some insurer was leaving the market:

This guy seems to think you Floridians have been a little too brazen with your fraud.



Friedlander said Florida’s elevated hurricane risk isn’t to blame for the crisis.

“We look down the road in Louisiana and see they’ve had seven storms strike the state in the last few years, Florida has had no direct strikes,” he said. “So you can’t blame hurricanes. This is 100% a man-made crisis driven by years of rampant risk fraud replacement schemes and excessive litigation filed against insurers.”

Friedlander zeroed in on roof repair fraud.

“Roof repair fraud schemes are the fuel that’s lighting the fire behind the rampant litigation being filed against Florida property insurers,” he said.
 
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BioHawk

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I could see how insurance companies would not want to ensure glass panels on roofs in a hurricane/tropical storm zone. They are almost assuredly going to take damage in one of those storms. I imagine Floridians might start seeing things like this a lot more for other things as well. What's remarkable is that it hadn't already happened a lot sooner.
 
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seminole97

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I could see how insurance companies would not want to ensure glass panels on roofs in a hurricane/tropical storm zone. They are almost assuredly going to take damage in one of those storms. I imagine Floridians might start seeing things like this a lot more for other things as well. What's remarkable is that it hadn't already happened a lot sooner.
Don’t know how other solar panels compare:


The solar tiles on a solar roof are rated for ANSI FM 4473 Class 3 hail resistance. This means that the solar tiles have been tested in a formal testing environment where 1.75in ice balls are launched five feet away at just below 72 m.p.h.

Let’s be honest, that sounds like a fun job.

After the ice balls are launched at the material in question (in this instance, a solar tile), it's inspected to see what damage, if any, is present. This includes cracks, visible dents, chips, or any other alteration that would otherwise compromise your roof.

Since Tesla's solar tiles have received the Class 3 rating, that means the 1.75in ice balls left no discernible damage at all. There is only one rating higher than Class 3, though the industry standard for roofs is Class 3.
 

The Tradition

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Either @The Tradition is the most self-assured and overconfident example of Dunning-Kruger on every subject or he is a master level troll. It’s just so hard to tell.

I don’t know whether to feel sorry for him or give him a standing ovation.

If you want to talk about people who are experts at everything, you might want to take a look at @Joes Place ...

Just sayin'...
 

mnole03

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There will be a Cat 5 that hits West Palm Beach or Lauderdale some day and it will break the market in Florida.
 

BioHawk

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Don’t know how other solar panels compare:


The solar tiles on a solar roof are rated for ANSI FM 4473 Class 3 hail resistance. This means that the solar tiles have been tested in a formal testing environment where 1.75in ice balls are launched five feet away at just below 72 m.p.h.

Let’s be honest, that sounds like a fun job.

After the ice balls are launched at the material in question (in this instance, a solar tile), it's inspected to see what damage, if any, is present. This includes cracks, visible dents, chips, or any other alteration that would otherwise compromise your roof.

Since Tesla's solar tiles have received the Class 3 rating, that means the 1.75in ice balls left no discernible damage at all. There is only one rating higher than Class 3, though the industry standard for roofs is Class 3.
I obviously don't know the specs of all solar panels but the article seemed to focus specifically on solar panel types that were placed on stands on the roof. The ones where they aren't shingles, but there is a bit of clearance underneath the panel and shingles on the roof. The concern being that when strong winds get underneath those panels they create lift and tear the entire panel off the roof.

Even so, the specs provided in your post would certainly be adequate for your average summer severe storm but a hurricane and even tropical storm are a different beast entirely. Those storms have sustained winds that last much longer and in the case of hurricanes it isn't hail but trees and other home debris that can be hitting the panels.

To be clear, I wish insurance companies would cover this stuff, but I can understand why they wouldn't. I'm sure they have run impact studies of what would happen if a hurricane hit a city with a certain percentage of homes with solar panels and evidently the numbers they got were not good for the survivability of the company. On the other hand, doesn't Florida have some sort of government subsidized insurance for homes anyway since so many companies were very hesitant of being in the Florida market in the first place? I don't know, but I thought I heard that somewhere.
 

The Tradition

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There will be a Cat 5 that hits West Palm Beach or Lauderdale some day and it will break the market in Florida.

There will be a Cat 5 that hits New Orleans or Houston some day and that will break their markets.

So, why just Florida?
 

mnole03

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There will be a Cat 5 that hits New Orleans or Houston some day and that will break their markets.

So, why just Florida?
Because the state is by far the largest insurer and totally unequipped to handle claims at that level?
 

seminole97

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Because the state is by far the largest insurer and totally unequipped to handle claims at that level?
Isn’t then the issue that the state intervention prevents market prices that could sustain the anticipated cost?
 

tarheelbybirth

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I obviously don't know the specs of all solar panels but the article seemed to focus specifically on solar panel types that were placed on stands on the roof. The ones where they aren't shingles, but there is a bit of clearance underneath the panel and shingles on the roof. The concern being that when strong winds get underneath those panels they create lift and tear the entire panel off the roof.
Solar panels installed to code are bolted through the roof joists. It would be impossible for them to tear off a panel without tearing out that entire section of the roof - joists and all. That would be...something.
 

Joes Place

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We have decided last week about “going solar”….We called out home owners who in turn called their underwriters….Our insurance folks answered by saying the “cost of the panels will be added to our roof“ and insured no problems.
I think this has to do with insurerers wanting to avoid “high risk” Florida p[roperties more than any other concerns. Bankers and insurers like your money….and they really like it when it is risk free.

Yep

Most insurers out here prefer panels, because they protect the roofs from hail damage. Lots of panels in my area out here; one insurance company replacing roofs everywhere said they lost 1 panel after 2" hail. Dozens of un-paneled roofs.
 

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