Homeowners Insurance May Be More Expensive After Going Green

04/28/2010

Going green may not only have an effect on energy costs - it can also impact Americans' home insurance premiums.

A recent report by the Insurance Journal offered advice for consumers hoping to reduce their ecological footprint. These individuals should first review their insurance policy to ensure that any environmentally-friendly upgrades are covered. If not, they may need to purchase a green homeowners insurance policy which can cover upgrade and replacement costs, according to the report.

"Some policies will cover home repairs using green materials, but will have a cap on covered costs," the report said. "Others may exclude coverage of items such as the fees charged by inspectors for having a home certified or re-certified as green."

Not all insurers are willing to cover solar panel or windmill installations, according to the report. Those that are will likely respond with strong premium hikes. Homeowners hoping to sell energy created by these devices may encounter further insurance difficulties.

Federal tax credits are one incentive for installing environmentally-friendly materials. Homeowners who take advantage of this program will receive a 30 percent credit, up to $1,500, on the costs for energy-efficient upgrades.

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