Solar panels represent a significant investment, particularly in the case of large-scale commercial installations on commercial premises, logistics centres or industrial roofs. Yet, in practice, insuring these installations is often treated as an afterthought, whilst incorrect or incomplete cover in the event of damage can lead to substantial financial setbacks. Anyone who takes insuring solar panels seriously is not only protecting the equipment itself, but also the energy yield and the long-term viability of the project.
The rules governing the insurance of solar panels have become stricter and more nuanced in recent years, partly because installations have grown larger and become more technically complex. This article provides a practical overview of the key points to consider, from standard cover to loss of output and documentation, ensuring that a policy truly reflects the reality of the installation.
Standard solar panel insurance typically covers damage caused by fire, lightning strikes, storms, hail and vandalism. These are the most common risks against which insurers provide cover, and in most cases they form the basis of every policy, regardless of whether the installation is residential or commercial.
It is just as important to be aware of what is not covered by standard cover. Wear and tear, gradual degradation of the panels and damage caused by construction faults during installation are almost never covered under a standard policy. Theft of the panels themselves is not always automatically covered either, which poses a real risk for large rooftop installations. It is therefore essential to read the policy terms and conditions thoroughly and check them against the specific characteristics of the installation.
In the case of commercial property, solar panels are often automatically regarded as part of the building and are therefore covered by buildings insurance. Whether this is actually the case depends on how the panels are fixed in place and how the insurer classifies them: as fixed assets or as separate fixtures and fittings.
Solar panel building insurance offers advantages in terms of simplicity and cost management, but it also has its limitations. The maximum compensation is often linked to the rebuilding value of the property, which may be insufficient for large-scale installations. A separate, specific policy for the solar energy installation provides greater control over the scope of cover, the insured value and the additional risks that can be included in the cover. For large-scale projects, a separate policy is usually the wiser choice.
Large-scale rooftop installations on commercial and industrial premises place different demands on insurance cover than a system comprising ten panels on a residential property. The total system value is higher, the technical complexity is greater, and the consequences of damage extend beyond simply replacing a few modules.
One factor that insurers are increasingly taking into account is the roof load caused by the installation. Traditional glass modules are heavy and can pose a risk to older or less load-bearing roofs. Lightweight panels, such as Solarge’s polymer-based 50% modules, which are lighter than conventional glass modules, significantly reduce this risk. Some insurers offer more favourable premiums or terms when the roof load can be demonstrated to remain within safe limits.
Liability is also a factor in large-scale installations. Damage to third parties resulting from panels coming loose, a fire spreading from the installation, or water damage caused by damaged roof penetrations is not usually covered by standard solar panel insurance. Supplementary liability insurance or an all-risk policy is therefore strongly recommended for large-scale projects.
One aspect that is regularly overlooked in commercial solar energy projects is the need to insure against loss of output. When a system is temporarily or partially out of action due to damage, the owner incurs not only repair costs but also a loss of energy yield. For large systems, this loss can amount to a considerable sum over the course of weeks or months.
Insurers are increasingly offering the option to include cover for loss of revenue resulting from insured damage. This cover works in a similar way to business interruption insurance: the loss of revenue over a specified period is compensated, based on historical production data or expected revenue. For projects where energy yield contributes directly to the payback period or to contractual supply obligations, this additional cover is not a luxury but a necessity.
A sound insurance policy starts with good documentation. When taking out commercial solar panel insurance, insurers usually ask for the installation’s technical specifications, purchase invoices, installation reports and information about the components used. The more complete and accurate this documentation is, the easier it is to determine the correct insured value and the smoother the process will be should a claim arise.
The traceability of the materials used is playing an increasingly important role in this regard. Panels equipped with a digital material passport, such as the C_passport® that Solarge links to each panel, provide insurers and owners with insight into the origin, composition and life cycle of the modules. This transparency not only strengthens an organisation’s sustainability reporting but can also significantly simplify the process of substantiating a claim, as the exact specifications of each panel are immediately available.
The most common mistake is underinsurance: the installation is insured for an amount that is lower than its actual replacement value. This often happens because the insured value was correct at the outset but was never adjusted following an expansion of the installation or following price increases in materials and labour. An annual review of the sum insured is therefore a basic requirement for any commercial installation.
A second common mistake is failing to report changes to the installation. Extensions, the replacement of inverters or alterations to the roof structure may affect the level of cover. If, in the event of a claim, an insurer finds that the situation differs from what was stated when the policy was taken out, this may result in a lower payout or even the rejection of the claim.
Finally, many parties underestimate the importance of a specialist insurer or broker with experience in solar energy projects. Standard commercial insurers are not always familiar with the specific risks associated with large-scale PV installations. A specialist knows the market, understands the technical context and can put together a policy that truly matches the scale and nature of the project. Investing now in a well-thought-out insurance strategy will help avoid costly surprises when it really matters.
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