A homeowner’s plan to make his home greener by switching to a heat pump and installing solar panels in 2023 took an unexpected turn when his then insurance company, CAA, nearly cancelled his policy over the upgrades – eventually pulling coverage entirely due to the solar panels.
A CBC News report cited Adam Szabo as saying: “I was confused, of course. I’m like, ‘What do you mean?’ It just doesn’t make sense, right?”
Szabo’s desire to boost his property’s value, reduce environmental impact, and lower energy costs was overshadowed by insurance complications he didn’t foresee.
The situation is said to be becoming more common as Canadians increasingly adopt eco-friendly technologies like electric vehicles, heat pumps, and solar panels to contribute to climate action. However, it was reported that many are discovering that such green initiatives sometimes clash with insurance policies.
Szabo, along with others from across Canada, shared their frustrations with CBC News after encountering insurance issues following solar panel installations. Many were unaware it could be a problem.
Rob de Pruis, national director for consumer & industry relations at the Insurance Bureau of Canada (IBC), explained that insurance companies determine which risks they’re willing to cover. Some companies include solar panels in standard home insurance policies, while others offer coverage as an endorsement or add-on.
In general, it’s rare for insurers to reject solar panels outright. De Pruis, however, mentioned that they can add to a home’s value, increasing the replacement cost, and potentially causing electrical system complications.
“We’re dealing with power and... changes to your existing electrical system,” he said. In addition, improper installation could lead to panels being torn off and causing damage during storms.
The IBC official also acknowledged that insurers have limited experience with claims related to solar panels and other green technologies, which contributes to their cautious approach. This was along the same line of reasoning provided to Szabo, who is now insured by Pembridge Insurance Company.
UPDATE: CAA has clarified that it does provide some coverage for solar panels, depending on the type installed and whether or not the homeowner is selling back to the grid.
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