Is Your AC System Insurance Covered By Homeowners And Renters Insurance?

September 28, 2023

Many homeowners do not realize their HVAC system is not covered by their homeowner’s insurance, yet this may not necessarily be seen as negative.

Standard homeowner policies cover AC unit damage only in cases of sudden perils or disaster, such as an explosion or tornado. Damage caused by general wear-and-tear, negligence or owner neglect does not fall within their coverage. For extra data, read more on Cinch Home Services’ official blog

Homeowners Insurance

Homeowners insurance may cover repairs or replacement of an AC system damaged by perils covered under either dwelling coverage or equipment breakdown coverage, including high winds, fallen trees, theft, fire or sudden and accidental damage such as sudden high winds. Your insurer will likely send an adjuster out to assess any damages and decide if they’re covered; in terms of AC units they may request documents like service call reports, photos and police reports as proof.

However, homeowners insurance typically does not cover damage caused by gradual wear and tear or neglect. If a leaky AC unit was caused by lack of maintenance over time, your claim would likely be denied and repairs or replacement would have to be covered out-of-pocket. You can avoid these problems by following recommended maintenance schedules as well as creating an emergency savings fund for unexpected costs.

Renters Insurance

Renters insurance protects your household appliances and electronics against perils that could potentially damage them to within the policy’s limit, with actual cash value or replacement cost coverage depending on which option is selected by your insurer. In addition, additional items that exceed standard personal property coverage limits can be covered through endorsements to the policy.

HVAC failure can result in serious property and personal damage, and renters insurance should cover these issues if caused by an insured peril such as building fire or water leak.

Filing an AC claim requires gathering specific details such as its model and serial number, pictures of damage to its AC unit, as well as police report (if applicable). You will also need to pay your deductible (typically a percentage of repair or replacement cost), so be sure to speak to a Lemonade agent to better understand how your policy operates.

Commercial Insurance

Homeowners insurance often includes coverage for air conditioning units in the same way it protects structures and personal items. If your AC unit is damaged by covered perils such as trees falling on it or hail, up to your policy limits you could receive reimbursement.

However, homeowners insurance may not cover damage caused by gradual wear and tear or negligence; additional coverage for these risks can be obtained with home warranties.

American Home Shield offers home warranties to protect up to 10 major appliances and 21 home systems and components, beginning at $80 annually with plans starting with free home inspection and maintenance checks. You may save money by shopping around, as many insurers offer discounts for well-kept homes or newly installed AC units. Once filing a claim with them, make sure you follow their guidelines to provide all the required documentation, collaborate with an adjuster on damage assessment, and follow up on potential payments – such as whether or not your claim is approved and how much they pay out!

HVAC Warranty

Many homeowners do not realize that their homeowner insurance policies cover HVAC repairs or replacements, although exclusions such as unusual wear-and-tear, so-called “acts of god”, and electrical surges may apply. Furthermore, some policies assume basic maintenance has been completed regularly so it is wise to request warranty documentation from sellers when buying a home as proof that you maintained systems before they break down and require repair.

Labor warranties are also typically provided by AC companies that install equipment. These warranties cover the installation process and are critical to good HVAC performance, making a company with an outstanding track record an invaluable source. A quality labor warranty often lasts multiple years for each piece of equipment installed by them; however, these do not typically include repairs or replacement costs of other parts within your system.

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Andi Perullo de Ledesma

I am Andi Perullo de Ledesma, a Chinese Medicine Doctor and Travel Photojournalist in Charlotte, NC. I am also wife to Lucas and mother to Joaquín. Follow us as we explore life and the world one beautiful adventure at a time.

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