Does Homeowners Insurance Cover HVAC?

min read
Updated: 27 February 2024
Written by
Cara Carlone
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HVAC, or heating, ventilation, and air conditioning systems are a major part of a home. 52% of American homes use natural gas for heat and 48% for water heating. If these systems fail, it could not only be a major inconvenience for the homeowner, but it can also wreak major havoc on your home.

Replacing your HVAC system can average between $5,000-$12,000, and homeowners insurance may not cover it. But how do you know what situations coverage will apply? I have been educating consumers about insurance for over 20 years and will break it all down for you. Keep reading to learn more.

Key Takeaways

  • Standard home insurance provides coverage for HVAC, depending on the cause of the damage

  • Flooding, wear and tear, neglect, and earthquakes are the most common exclusions on homeowners’ policies

  • Coverage for these losses can be purchased as a separate policy or adding endorsements to your home insurance

  • A home warranty can protect HVAC systems from wear and tear

Does Homeowners Insurance Cover HVAC?

Your homeowners’ insurance will cover your HVAC system in certain situations, but not all. To determine when coverage will apply and when it won’t, you have to understand what your homeowners’ policy will typically cover.

A standard home insurance policy will provide coverage for the structure of your home, including anything attached, on an open peril basis. Open peril means that you are covered for any event that can happen to your home unless it’s specifically excluded in the contract. Some of the more common exclusions include wear and tear, floods, and intentional damage.

Since major heating and central AC systems are attached to your home, if your HVAC system fails, there is coverage available under a standard home insurance policy, assuming what caused the breakdown is not excluded. But if you have AC window units that aren’t permanently attached, those would be considered part of your personal property. So how would those be handled?

Most standard policies cover your personal property on a named peril basis, which means there are 16 specific events it will cover. Some of these perils include fire, theft, hail, and windstorm. If your window unit is stolen, for example, coverage would apply.

When Does Homeowners Insurance Cover HVAC?

Standard home insurance policies provide coverage for your HVAC system in most situations unless it’s excluded. But there are some scenarios that you can almost guarantee coverage will be available.

Fire

The National Fire Protection Association (NFPA) reports that 2,800 house fires occur each year due to air conditioner units, and 13% of all home fires reported between 2016 and 2020 were the result of heating equipment. Fortunately, almost all home policies will cover a fire event, both for the structure of the home and personal property. If a fire damages your HVAC system, your home insurer is likely to cover this loss.

Note: If you have a wood stove, be sure to let your insurance carrier know. Especially if you use it as a primary source of heat, as there could be potential coverage issues in the event of a claim.

Weather

Most weather events, such as windstorms, hail, and lightning, are covered under a standard home insurance policy, including a tree falling onto your unit. In the case of these events damaging your HVAC, your home insurer should cover the repair or replacement of the system.

While many weather-related losses are covered events under your home insurance policy, it’s important to note that some aren’t. Specifically, floods and earthquakes. Both of these require a separate policy.

Important: Some home insurance policies have a separate deductible for hurricanes or wind storms, which can be a percentage of your dwelling amount. Check your deductible before filing a claim to ensure the damage exceeds this amount.

Theft

While it may be slightly harder to steal an entire HVAC system, your AC window units can be stolen. Since window units can be removed and aren’t permanently attached to your home, they would be considered part of your personal property.

Personal property is not covered as broadly as your dwelling is, but theft is a covered event. So if you have AC window units and they are stolen, your home insurer will cover the cost to replace them.

Water

Depending on the source of the water, home insurers may provide some coverage for your HVAC. Flooding and sump pump overflow are excluded, although coverage can be purchased from either another policy or an endorsement. Burst pipes that cause water damage to your HVAC would generally be considered a covered event.

When Doesn’t Homeowners Insurance Cover HVAC?

As mentioned previously, there are certain coverage exclusions to any homeowners’ insurance policy. Some of the more common exclusions are noted below.

Wear & Tear

Home insurance is meant to cover unexpected events. Wear and tear of any major system is inevitable and therefore, not covered. If your HVAC breaks down due to its age and not as a result of a covered peril, your home insurer will not pay for the repair or replacement.

Flood

According to the National Association of Insurance Commissioners, 90% of all-natural disasters involve flooding. Unfortunately, flooding is excluded from home insurance policies and needs to be purchased under a separate policy. Homeowners who are concerned with HVAC damage from flooding events should purchase a flood policy through the National Flood Insurance Program (NFIP).

Neglect

All major systems within your home require routine maintenance and upkeep to ensure they work properly. In a recent survey conducted by Duraplas, a provider of plastics for the Agriculture, Industrial, Energy, and Greenhouse industries, it was found that only 30% of homeowners conduct preventative maintenance on their HVAC.

This failure to maintain can potentially cost homeowners coverage for any loss that occurs on their heating or air conditioning.

How To File An HVAC Claim

Filing a claim for your HVAC is similar to filing any other home insurance claim. Once you notice damage to either your heating or air conditioning, you should follow the steps below.

  • Protect the systems from further damage- If you are able, protect the systems from further damage. For example, shut off the electricity to the heater or AC.
  • Determine the extent of the damage- Remember that your deductible will apply to any loss. If the damage to your HVAC system is minimal, there is a chance the repairs will be under your deductible and not covered.

Note: Some insurers have separate deductibles for wind or hurricane losses. These deductibles can be a percentage of your home’s dwelling limit and not a flat amount. Be sure to look at the correct deductible before determining whether the damage exceeds this amount.

  • Take photos of the visible damage- Document the notable damage as your insurance company may need it for their records.
  • Contact your insurance company- Call your insurer to report the incident and start the claim process. Provide as many details as possible. They will be able to determine whether coverage is applicable.
  • Meet with an adjuster- An adjuster will typically visit your home to assess the damage and confirm coverage.
  • Keep receipts or contracts-  Once coverage is confirmed and repairs have started, hold onto any receipts or contracts. You will need to submit these to your insurer for reimbursement.
  • Submit proof of work- When the work is completed, send these receipts and contracts to your insurer as proof of repairs. They should then be able to cut you a check, minus any applicable deductible.

Home Warranty Coverage

Homeowners may also choose to purchase a home warranty for major home appliances and HVAC systems. Unlike home insurance, a warranty provides coverage for age-related failures or wear and tear. Carrying both home insurance and a home warranty guarantees that coverage is available for most of the events that could damage your HVAC.

Event Home Insurance Home Warranty
Fire Yes No
Lightning Yes No
Wind Yes No
Flood No* No
Earthquake No* No
Theft Yes No
Wear and Tear No Yes
Neglect No No
Hail Yes No

*Requires another policy or endorsement

Additional Coverage Types For AC Units

Customers who want to maximize their coverage for AC units can look into the following options.

Flood

Flood policies can be purchased either through the NFIP or through a private insurer. These policies provide coverage for flooding that standard policies typically exclude. The cost of a flood policy can vary, depending on where you live, but the average is about $700 per year.

Equipment Breakdown Coverage

Equipment breakdown is an optional coverage that can be added to your home insurance policy to cover the mechanical or electrical breakdown of your HVAC system and other appliances. There is a coverage limit and a deductible associated, and it can differ from the limits and deductibles for your dwelling. The average cost of this endorsement is typically between $25-$50 per year.

Earthquake

While some carriers may offer earthquake coverage as an endorsement to their home policy, many do not. Customers who wish to be covered for this may be forced to buy a separate policy. Because the cost of earthquake insurance is dependent on where you live and your risk of earthquake, prices can vary from $800 to $5,000 per year.

Water Backup Coverage

Customers can add a water backup endorsement to buy back coverage for these losses, which are typically excluded from their policy. With this endorsement, homeowners are protected from water damage for the backup of their sewer, drains, and sump pumps. The cost of this coverage can range between $50 to $250 per year, and I always recommend purchasing.

FAQs

Does homeowners insurance cover AC problems?

Homeowners insurance may cover problems with your AC, depending on the damage and what caused it. Home insurance generally does not provide coverage for specific events such as flooding, wear and tear, neglect, and earthquakes. A separate policy or additional endorsements may need to be purchased to obtain coverage in these cases.

Does homeowners insurance cover AC unit leaks?

Homeowners insurance may cover an AC unit leaking, depending on what caused the damage. Your standard policy will not cover losses stemming from flooding, wear and tear, neglect, or earthquakes. To determine if coverage is available, you should contact your insurance company.

Can I buy air conditioning coverage?

Yes! In addition to your standard home insurance policy, adding an equipment breakdown endorsement and purchasing a home warranty ensures you will have the broadest coverage available for your air conditioning unit.

Sources

  • ASHI – How much does a new HVAC system cost
  • NFPA – Home heating safety
  • NAIC – Flood insurance / National Flood Insurance Program
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