Is Solar Right for You? Key Factors to Think About Before Installing

By Adam Bakonis and the Mercury Team

Increasingly, homeowners are turning to solar energy as a smart way to lower energy costs, minimize their environmental impact, and gain a bit more independence from the grid. With solar panels popping up on rooftops across the country, it’s natural to start wondering: Is solar right for me?

In this guide, we’ll walk through everything you need to consider before installing solar panels, including the installation process, system components, financial incentives, and how solar can impact your homeowners insurance coverage.

What to Know About Solar Panel Installation

A solar panel installation is a major home improvement project that can provide long-term energy savings, but it’s important to know what the process entails:

1. A solar installer will assess your roof’s condition, angle, and sun exposure to determine if it’s a good fit for solar panels.
2. Based on your home’s energy use and roof layout, the installer will create a custom solar system tailored to your needs.
3. Your installer will handle the local permits, utility approvals, and any necessary HOA documents before work begins.
4. Once approved, the installation usually takes one to three days. Panels are mounted, wiring is completed, and the system is connected to your home.
5. After a final inspection from your local building authority, your utility company gives permission to activate your system and connect to the grid.

Keep in mind that not every roof is a perfect fit. Roofs that are old, shaded, or made of tricky materials like clay tiles might need extra work. Your location, local rules, and HOA guidelines can also affect the process. That’s why it’s important to work with a licensed, experienced installer who knows your area.

Understanding a Home Solar System

If you’re new to solar, the idea of a home solar system might sound a little complex, but it’s easier to understand than you might think.

At the core are your solar panels, which sit on your roof and soak up sunlight. They turn that sunlight into electricity, but it’s in a form called direct current (DC). Since your home uses alternating current (AC), the system includes an inverter that converts the electricity into a usable form.

Some systems also include a battery, which stores excess energy for use during nighttime or power outages. It’s optional but great if you want more energy independence.

Most systems are connected to the electric grid, so when your panels produce more electricity than you need, the extra power goes back to the grid. In many areas, you can earn credits through net metering, helping to offset your utility costs.

Should I Get Solar Panels?

Wondering if solar panels are the right move for your home? It really depends on a few key factors, like how much sun your roof gets, how much energy you use, and what kinds of savings you’re hoping for.

Sunlight and Energy Use

Solar panels work best on roofs that get steady, direct sunlight, especially those facing south or west. If your household uses a lot of electricity (for example, charging electric vehicles or running large appliances), you’ll likely see more savings over time.

Incentives and Rebates

There are federal, state, and even local incentives that can reduce your upfront costs. For example, the federal Residential Clean Energy Credit offers up to 30% off installation costs through 2032. You can also find state-specific incentives through the Database of State Incentives for Renewables & Efficiency (DSIRE).

Cost and Savings

According to EnergySage, the average cost of a solar panel installation is $20,552 after the federal tax credit. However, you can recover those costs within about seven years through lower utility bills. After that, it’s mostly savings and possibly an increase in your home’s resale value.

Solar Panel Pros and Cons

Like any home upgrade, solar panels come with both advantages and a few potential downsides. Here’s a quick breakdown to help you weigh the decision.

Pros of Solar Panels

• Lower energy bills: Once installed, solar panels can greatly reduce your monthly electricity costs, especially if you use a lot of power during the day.
• Energy independence: Producing your own electricity means you rely less on the grid, which can be especially helpful during outages or rising utility rates.
• Eco-friendly: Solar energy is clean and renewable, helping reduce your home’s carbon footprint and greenhouse gas emissions.

Cons of Solar Panels

• Upfront cost: The initial cost can be high, typically around $20,000, after accounting for the federal tax credit.
• Weather dependence: Solar panels are less efficient during cloudy days or in shaded areas.
• Maintenance needs: While minimal, panels should be inspected and cleaned occasionally to stay efficient.

Do Solar Panels Impact Homeowners Insurance?

If you’re planning to add solar to your home, it’s smart to think about how solar panels and home insurance work together. Does homeowners insurance cover solar panels? Yes, most policies do cover rooftop solar panels. That means if your panels are damaged by a covered event like wind, hail, or fire, they’re typically protected under your dwelling coverage.

That said, it’s important to let your insurance company know before or immediately after installation. Your provider may need to adjust your coverage limits to reflect the increased value of your home. In some cases, this could slightly raise your premium, but you’ll have peace of mind knowing your investment is protected.

Also, if you’re installing ground-mounted panels or solar battery storage, check with your insurer. These might be considered separate structures or personal property, which could require additional coverage.

“Homeowners should treat solar panels like any other major home upgrade. Always inform your insurer so your coverage reflects the true value of your home.” Adam Bakonis, Sr. Product Manager State, for Mercury Insurance.

Additional Considerations Before Going Solar

Before you make the leap into solar, there are a few more things to keep in mind that go beyond installation and savings.

Impact on Home Value

Solar panels can increase your home’s resale value, especially in areas where energy costs are high. According to Zillow, homes with solar-energy systems sold for 4.1% more on average, which is an additional $9,274 for a median-priced home. Just make sure your system is owned (not leased), as buyers tend to prefer that.

Local Regulations and HOA Rules

Each city, county, and even homeowners association (HOA) may have its own rules about solar installations. Some areas require special permits, while others may limit panel placement for aesthetic reasons. It’s a good idea to check local guidelines early, so you’re not caught off guard.

Maintenance and Monitoring

While solar panels are low-maintenance, they’re not completely set-it-and-forget-it. Occasional cleaning and periodic inspections help keep them running efficiently. Many systems also come with monitoring apps so you can track performance and spot any issues quickly.

Conclusion

Adding solar panels to your home can be a great move for your wallet and the environment. But before you take the leap, it’s worth thinking through a few key details, like how much sun your roof gets, your energy needs, the available incentives, and how it might affect your homeowners insurance.

At Mercury Insurance, we’re here to help protect your investment and your home. We offer reliable coverage and cheap home insurance options that don’t cut corners on quality or service.

Contact us today for a fast, free quote!