The vast majority of solar contractors have general liability policies. In fact, you should check this as a consumer and refuse to work with a company that doesn’t have it. Furthermore, this is not enough. Many contractors simply do not understand what their policy covers. This is because of the lengthy lists of exclusions, terms and conditions, and other rules. Understanding the basics of this type of insurance will help you to understand why insurance is so important.
General liability insurance pays for property damage and bodily injury, as it occurs to third parties. In insurance terms, what this policy offers is premises exposure, which is covered by premises liability. Then, there is products liability, which focuses on completed operations. This is offered not on the property that the contractor works on, but on the services and goods offered by the contractor.
Exclusions to Policies
Most solar contractors have now fill in a standard general liability insurance form. This means that they know exactly what they are covered for. In most cases, contractors expand on this so that they are covered for other possible issues. However, exclusions often exist, which means that there are certain things that people are not covered for. Common exclusions are:
Bacteria, mildew, and mold, which means that coverage is restricted for incidents related to moisture. This can be purchased separately, but is often very expensive.
Control, custody, and care, meaning that anything that is under the temporary control of the contractor is not covered. This may include the roof itself.
Subcontractors, which means that contractors who hire an electrician to check the system, for instance, will find that the electrician’s work is not insured.
Why Is Insurance Needed?
The world of insurance is highly complex and this is one of the reasons why so many contractors do not have the right level of coverage. It is simply too complicated to understand what is and isn’t covered, and what should and shouldn’t be covered. However, you, as the one who hires them, have a responsibility to make sure that they do have the appropriate coverage. This is because a number of things could go wrong. For instance:
A panel may slide out of the hands of the installer while on the roof, causing damage to the outside of your building or possibly injuring a passersby.
Solar panels are electrical components, and a poor connection or other issue could lead to a fire.
Panels could be improperly installed, leading to roof leaks and other problems.
Those are just the problems that can happen during or after installation. Once installed, a variety of other things can go wrong. While these are rare, it is important that you are covered for such eventualities. Make sure, therefore, that you ask to see the insurance policies that a contractor has, and how these affect any subcontractors they bring in. Feel free to contact their insurance company to find out which exclusions and restrictions are in place. It is important that you protect yourself, your home, and your investment, after all.