What Does Home Insurance Cover in California? FAQs
Key Points
- Home insurance can cover the building, contents, and personal liability.
- Home insurance covers hail damage to the roof and the solar panels, but additional endorsements may be required for homes with multiple panels.
- Residential property insurance covers water damage caused by burst pipes, accidental leaks, and persistent roof leaks. Home insurance can cover water leaks, but coverage may be denied for preventable leaks or those caused by wear and tear or poor maintenance.
- Home insurance provides temporary housing coverage if the home becomes uninhabitable due to certain perils.
- Home insurance in California covers theft, including personal property stolen from outside the home.
- Mold damage is covered by home insurance if caused by specific perils, but flood-related mold damage may not be covered.
- Home insurance covers foundation problems caused by covered perils, but flood and earthquake coverage is separate.
- Home insurance covers disasters like wildfires, windstorms, tornadoes, and volcanic eruptions, but separate policies (or add-on riders o the policy) are needed for floods, tsunamis, and earthquakes.
Introduction
Depending on the chosen type of home insurance in California, it provides slightly varying coverages. Homeowners and landlord’s insurance covers the building itself and its contents, while renters and condo insurance mostly covers just what’s inside. All California home insurance policies offer a degree of personal liability protection too. Let’s take a deeper look:
Are Solar Panels Covered by Home Insurance in California?
Solar panels and home insurance: A typical residential (homeowners, renters, and condo) solar panels insurance coverage insures solar panels against perils like theft, fire, and some natural disasters (most commonly hail). In 2018, California became the first state in the US to mandate the installation of photovoltaic cells or solar panels for new buildings. Due to the 2019 Building Energy Efficiency Standards created by the California Energy Commission, solar panel home insurance coverage is more important for California residents. The Golden State has produced enough solar power for more than 10 million residents, according to the California Solar Energy Industries Association.
Homeowners often install their solar panels on the roof or mount them on the ground, while renters or condo owners may purchase a portable solar panel. Condo owners living in homes with shared solar panels installation can get coverage under the condo association policy. The type and location of the PV cells will determine the amount of coverage necessary for homeowners, condo owners or renters.
Solar panels mounted to a home's roof are normally covered under the home policy's dwelling coverage. This implies that if the solar panels are damaged due to an insured peril, your insurer will cover the replacement or repair cost up to the coverage limit as agreed in the policy document. Ground-mounted photovoltaic cells or solar panels affixed to a garage are normally covered under Coverage B or attached structures insurance. The amount the insurance provider will cover for repairs to these structures often has a claim limit, which is 10% of the entire policy value. Therefore, a detached garage with photovoltaic panels would be covered for $20,000 if the home's dwelling coverage is set at $200,000.
Keep in mind that not all home insurance companies on the California market offer protection for solar panels. As a result, confirm whether you are approved for coverage with your insurance agent and examine your property insurance policy. Your current residential property insurance can be modified to include solar panel coverage with the assistance of a professional insurance agent. Alternatively, if your existing insurance provider does not provide coverage for home-installed solar systems, they can assist you in finding new home insurance California quotes.
Do Solar Panels Affect Home Insurance in CA?
Photovoltaic (PV) systems mounted on your property will affect your home insurance quotes in California. This is because installing and paying for solar panels often increases the property’s worth and the amount of work that needs to be done to repair the structure on which it is mounted, in case of damage. If the solar panels are on the roof, if the roof needs to be replaced, all other panels must be removed and then remounted. Even if the solar panels themselves do not get damaged, the removal and reinstallation process makes potential roof claims more expensive. This risk in return affects your home insurance with an increase in premium.
Installing a basic PV solar panel system costs California homeowners between $10,000 and $16,000. As a result, a house with solar panels will be worth more than a similar one without PV cells. To adequately cover solar panels, insureds must extend the dwelling coverage limit due to a greater replacement cost, which results in higher rates. If you have any concerns about home insurance in California that pertain to solar panel coverage, you should speak with a local property and casualty insurance agent who has experience insuring solar in California.
How Much Does California Home Insurance Go Up With Solar?
You should expect a 10% - 15% increase in premium to insure an 8KW solar system worth $16,000. Several factors will determine how much your solar panel insurance cost goes up with additional installed solar panels. Some of these factors are the number of solar panels installed, the solar panel type, and the house's electrical usage. Residents who want their PV systems to supply all of their energy requirements frequently will add extra solar panels to their roofs; this will translate to a higher home insurance rate. Moreover, insuring a roof-mounted PV cell is often more expensive than insuring a ground-mounted PV cell.
Before adding solar panels to your homeowner insurance in California, you should speak with a knowledgeable residential property insurance agent. This way, you can know how the solar panel installation will affect the insurance premium. Consulting your insurance agent will guarantee that in the event of unforeseen circumstances, the coverage level of your policy will be sufficient to fix both your home and your solar systems. The cost of residential insurance in California might increase if you add solar panels, although the percentage rise will mostly depend on the insurance provider.
Does CA Home Insurance Cover Hail Damage to Solar Panels?
Yes, home insurance covers hail damage to solar panels. Rooftop solar panels are vulnerable to severe weather, such as hailstorms. In most cases, property insurance policies from California P&C insurers cover minor hail damage to solar panels. Nevertheless, some insurance companies demand that homes with multiple solar panels buy a separate endorsement to cover hail damages (also known as the solar panel hail damage insurance). You can also buy a home warranty insurance policy that covers repairs or replacement of major appliances like solar panels. If you want to find out whether your current property insurance policy covers hail damage to solar panels, consult with a P&C insurance agent. A knowledgeable agent can provide information on how to get additional solar panels hail damage insurance, raise the dwelling coverage limit, or explore alternative insurance companies that offer comprehensive coverage for solar-powered homes.
Does Home Insurance for California Cover Leaks?
Home insurance water leaks coverage in California extends to water leaks caused by defective plumbing if the leakage is unexpected and unintended. Examples of such unforeseen leaks are when a pipe bursts or a laundry machine supply hose unexpectedly breaks. Your insurance may deny claims for damage repair if the water leaking was brought on by poor management. For example, if a water heater slowly rusts and eventually leaks as a result of not using enough water softener, this can be considered by the insurer as a non-covered water leak. Landlords, tenants, and condo insurance plans all provide coverage for defective and unforeseen leaks.
What Does Home Insurance Cover for Water Damage in California?
Water seepage or leakage coverage: Typically, residential property insurance provides coverage for accidental and abrupt water damage. California P&C insurers offer home insurance policies that cover water damages that include ruptured pipes, accidental leakages, and persistent roof leaks. Home insurance will not cover flood damage or losses caused by a hurricane's tropical storm. To safeguard yourself from any flood-related losses, you should get a separate flood insurance policy, which in the Golden State is obtained under a separate cover. Consult a California-licensed P & C insurance agent if you need assistance understanding your policy's provisions regarding water damage or if you need clarification on what kind of water damage is covered or excluded by your coverage.
Does Home Insurance Cover Plumbing Leaks?
Yes. A typical California home insurance company will include plumbing leaks caused by burst pipes if the damage is abrupt and unexpected. This means that if a broken water pipe causes your basement to flood suddenly, your home insurance will pay for the cost of fixing any damaged furniture and repairing the flooring and walls. Home insurance often does not cover preventable water damage, such as gradual leaks or clogged drains in an unheated home, even if many plumbing issues are covered by it. For example, if you had a shower leak behind the wall insurance would likely not pay for the caused damage. Furthermore, if mold grows due to preventable water damage, your insurance provider may reject your claim to remove or remediate the mold damage. It is advisable to fix minor plumbing leaks right away to prevent further property damage and potential out-of-pocket expenses.
Does Home Insurance Cover Roof Leaks?
California residential property insurance policies include coverage for roof leaks damaged by insured perils. However, the initial cause of the roof leak will determine if your home insurance company will reimburse you for the leak repairs and any subsequent damage to your belongings. Home insurance does not cover leaks brought on by regular wear and tear or poor maintenance. Details of what is included and excluded in your residential policy are available on the policy's declaration page. With the help of a qualified P&C insurance agent, you can easily file a claim with your insurance provider if a covered roof leak occurs.
Does Home Insurance Cover Temporary Housing in California?
Yes, your CA home insurance policy provides temporary housing as Coverage D. This coverage is necessary if your house becomes uninhabitable due to devastating perils like wildfires, tornadoes, and hurricanes. After the damage and while your home undergoes repairs, your insurance provider will cover the cost of living in a hotel or feeding in a restaurant up to the coverage limit. Some Coverage D policies include payment for staying in a temporary home when your house is at risk of a declared disaster that is yet to occur. Other terms used in your policy document for temporary housing coverage include:
- Additional living expenses (ALE)
- Loss of use coverage
- Coverage D
Does Home Insurance Cover Theft in California?
Home theft insurance: Residential property insurance in California often provides coverage against all kinds of theft. Burglary and theft or personal property are two common property crimes in California that can damage your building or personal possessions. According to the Crime in California 2021 report, 65% of total crimes in California are burglary and larceny. You can file claims for repairing damaged buildings or replacing stolen personal possessions if you have a comprehensive home insurance policy in California. Landlords, renters, and condo owners can all get theft coverage for their homes.
Most home insurance policies in California also provide protection for your personal property that may have been stolen from you while away from home. For example, your personal belongings stolen at work are likely covered by your home insurance.
Some home insurance providers offer identity theft protection as a rider or endorsement to their coverage. Personal items you bring on vacation are also covered under the contents coverage or coverage C. This implies that your insurance provider will cover the cost of replacing any stolen personal property if it is taken while you are traveling. Personal property protection also covers break-ins that take place on your property when you aren't home. Nevertheless, your insurance provider could reject your claim if you have been away from your house for a long time. To avoid your claims being rejected when you are away from home, discuss your plans with a CDI-licensed insurance agent who can help you find the best home insurance companies in California offering vacant home coverage.
Does Home Insurance Cover Mold in California?
Is mold damage covered by insurance? Yes, mold coverage is available through your California residential property insurance policy. Mold is a fungus that releases poisonous substances which can cause severe health problems. Aside from its unsightly look, indoor mold can degrade wood, cloth, upholstery, and other structural components permanently. With your home insurance, your insurance provider can pay for mold damages brought on by broken pipes, overflowing toilets, or faulty appliances. However, flood-related mold damage and other mold problems resulting from carelessness may not be included in the policy.
Renters insurance also offers mold coverage to tenants, provided the mold was not present before renting the apartment. This means that an insurer may reject the tenants claim if proven that the mold damage is the landlord’s responsibility. Meanwhile, condo unit owners in California can get coverage for mold problems through their condo insurance or the condo association policy. Generally, renters, landlords, condo owners, and homeowners should consult their insurance agents to understand the limit for mold coverage in their policy.
Does Home Insurance Cover Foundation Problems in California?
Yes, you can get reimbursed by your insurance company for your home’s foundation repair when it is damaged by covered perils. Some perils that can damage or destroy the foundation include settling, explosions, water leakage, volcanic eruptions, eroded sinkhole, and fire. Damaged foundation commonly also leads to cracked walls.
Floods and earthquakes also damage the home’s foundation, but they are often excluded from your residential insurance. Buying a separate flood insurance policy or earthquake coverage is a good way to ensure that you will get compensation whenever those perils harm the home’s foundation.
Does Home Insurance Cover Natural Disasters in CA?
Home insurance covers disasters like wildfires, windstorms, tornadoes, and volcanic eruptions. However, residents will need to buy separate natural disaster insurance policies to cover natural disasters like floods, tsunamis, and earthquakes. California is prone to unpredictable natural disasters resulting in significant financial losses. Unfortunately, few people are conscious of the impact of these disasters unless they have lost their homes and personal goods to one. Selecting property insurance coverage that provides the protection you want is easier if you are aware of the catastrophes that are most likely to happen in California.
According to the California State Board of Equalization, the state witnessed 159 Governor-declared disasters between September 2022 and October 1991. Common disasters in 2022 which have resulted in property damage include fire and tropical storms. An example of a devastating fire disaster occurred on September 2, 2022. The Mill Fire destroyed 118 buildings while causing minor damages to 26 structures in Siskiyou, California. Winter storms in December 2021 also affected several counties in California, leading to the Governor’s state of emergency proclamation. Apart from floods and fires, earthquakes are also common in the Golden State. A magnitude 7.1 earthquake, known as the 2019 Ridgecrest earthquake, damaged more than 100 homes, resulting in property losses worth $1 billion. According to the U.S. Geological Survey, over 3000 minor and major tremors have occurred in California since the 2019 earthquake. Due to these multiple disasters, California is working on an innovative Climate Insurance while some private insurers offer separate policies like the California home fire insurance.
Without a doubt, ensuring you have adequate home insurance coverage and other standalone disaster policies is the best way to avoid financial losses caused by these disasters. Here are some of the important disaster insurance coverages essential for California residents.
FLOOD INSURANCE
Floods are a common natural disaster in California and other states in the US, with only an inch of floodwater resulting in property damage worth $25,000. In the last 25 years, at least one significant flood occurred in each of the 58 counties, which has caused fatalities and billions of dollars worth of damage. Flood damage is not covered by homeowners, condo, or renters insurance. However, you can buy home flood insurance under a separate cover through a private property and casualty insurance company or via the National Flood Insurance Program (NFIP Direct).
The NFIP was established in 1968 by the US Congress to minimize flood damage. Being a government program run by the Federal Emergency Management Agency (FEMA), the NFIP Direct home flood insurance is available for homeowners, renters, condo owners, landlords, and mobile homeowners in California. However, only residents living in NFIP communities in California can purchase NFIP flood insurance. To purchase NFIP flood insurance, you should contact a state-licensed property and casualty insurance agent that works closely with FEMA.
You can also purchase a separate flood and hazard insurance policy through a private P&C insurer in California. Note that the cost of flood insurance often varies based on different factors such as building type, age, and elevation. The major factor that affects the flood insurance premium is the location of your building. Individuals living in high-risk or special flood zones often pay more than those living in low-risk flood regions. Look up FEMA's Flood Maps to know if your home is within the high-risk flooding zone. Apart from helping you to purchase flood insurance, your insurance agent can provide information on what is covered and not covered in the separate flood policy. You can contact NFIP Direct Help Center by calling 1-800-427-4661 to ask for an agent recommendation if your insurance agent does not provide home flood insurance coverage.
TORNADO INSURANCE
Getting coverage for damages caused by tornadoes is very important for California homeowners, renters, landlords, and condo owners. According to a report by the Insurance Information Institute, the Golden State witnessed only 5 tornadoes in 2021. However, statistics from the National Oceanic and Atmospheric Administration reveal that California has had a history of devastating tornadoes in the past. In 2015 alone, the state suffered 10 tornadoes which resulted in property losses worth $20 million. Tornado damage is caused when whirling debris and heavy items strike the surrounding buildings. Tornado-related property devastation can also result from pressure changes and extremely strong winds. Generally, your residential insurance policy should include tornado coverage as part of the wind coverage. Go through your policy with a P&C insurance agent to discover what is covered and excluded from your property insurance coverage.
HURRICANE INSURANCE
Hurricane home damage: In September 2022, Tropical Storm Kay hit highly populated areas like Los Angeles County, San Bernardino County, and Riverside County. At least 30 properties were destroyed or damaged during the disaster, with other flash floods reported in surrounding regions. Generally, California hurricanes can result in multiple forms of damage at the same time yet most P&C insurance providers do not offer standalone hurricane insurance. Your claims may be rejected if your property sustained water damages due to a hurricane but your residential property insurance only includes hurricane's winds coverage. As such, it is best to purchase comprehensive home insurance and home flood insurance to cover all hurricane-induced damages. Discuss your needs with a professional insurance agent who can assist you in choosing the best residential property insurance coverage to adequately protect your home and personal property from any storm damage.
EARTHQUAKE INSURANCE
Earthquakes in California are common because the state is situated on the San Andreas Fault. Between 1812 and 2022, there have been 78 big California earthquakes, above magnitude 6.5 with property damages above $200,000. Thousands of devastating aftershocks, foreshocks, and tremors have also been reported in the Golden State. According to the California Earthquake Authority, the probability of a magnitude 6.7 and above occurring in California within the next 30 years is more than 99%. Despite the numerous cases of earthquakes, individuals are not required by California law to purchase earthquake insurance. California P&C insurers are required by law to offer an earthquake insurance contract to policyholders with homeowners, renters, or condo insurance. The contract has to be made in writing; It must disclose the limits, deductible, and premium together with the coverage options. Policyholders are expected to accept the offer within 30 days, which begins on the day the insurance provider sends you the offer. If the insured doesn't respond, it means the offer has been rejected.
You have two options for purchasing a quake cover insurance in California: either directly from the private insurer providing the coverage or through the California Earthquake Authority (CEA). Most Californians who own homes, mobile homes, condo units, or rent a house buy their earthquake policies from the CEA. Note that it is impossible to purchase earthquake insurance directly from CEA; you can buy from CEA participating home insurance companies. To purchase a California earthquake home insurance, you must already have a property coverage in effect. The same insurance provider you use for your residential policy must also be used for your CEA coverage. Speak with your home insurance representative to know more about adding supplemental earthquake insurance to your existing residential policy.
SINKHOLE INSURANCE
Sinkholes are not common in California but there have been notable cases of sinkholes in the past. California sinkholes are often caused by water leaks, such as the collapsed sewer pipe and water main breaks. Some of the most significant sinkholes are caused by unexpected landslides in the earth's crust as a result of erosion or underground caverns that form close to the ocean. A comprehensive residential property insurance does not include sinkhole coverage. However, some insurance providers in California allow insureds living in sinkhole-prone areas to add sinkhole home insurance coverage as an endorsement to their residential property insurance. If your insurer allows a sinkhole coverage, ensure you understand what is covered and what will not be covered. This way, your home insurance company will not reject any claims submitted after a sinkhole damage. It is important to contact a California-licensed P&C insurance agent who is familiar with the local sinkhole threat. It will be easier to obtain enough insurance against sinkhole damages with the assistance of such an experienced agent.
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