Your air conditioner is essential to your home, especially in states like Florida, where temperatures climb to the 90s in the summer and hover below 80 degrees in the winter.
Even if you buy a highly efficient central air conditioning unit, the outdoor part of the unit is vulnerable to the world’s dangers. And with an average cost of about $6,000 for a central AC unit and installation, you’re smart to wonder if homeowners’ insurance covers AC.
The longer answer is that AC units can be covered by your individual homeowner’s insurance policy but only if the damage was caused from a covered peril. Damage due to wear and tear, or negligence to keep up with maintenance, the AC unit would not be covered.
A Note on Differing AC Coverage Among Providers
We emphasize that AC coverage depends on your home insurance policy because every provider differs.
For example, some providers may cover hail damage, while others may not in states where hail is much more common.
If you’re unsure about your policy’s coverage, we highly recommend talking to your insurance agent to gain clarification and make more informed decisions about whether to file a claim.
When Does Homeowners’ Insurance Cover AC?
The dwelling portion of your homeowners’ insurance policy kicks in for your central AC unit when a covered peril results in a loss.
In other words, your home insurance will cover your central AC unit under certain circumstances and within your coverage limits.
Dwelling coverage is the part of your homeowners’ insurance policy that protects your home’s main structure and other structures attached to it. Because your central AC unit is fastened to your home’s property, it falls under your dwelling coverage.
A peril is an occurrence, like a fire or storm, that damages or destroys something—in this case, the AC. Covered perils are those that your home insurance provider protects against in your policy.
Your poor AC unit can fall victim to any of the following dangers that your policy may consider covered perils:
- Fire and smoke
- Explosions
- Windstorms
- Hail
- Lightning
- Power surges
- Falling objects (including trees)
- Theft/vandalism
Review your policy or speak to your insurance agent to better understand your policy’s dwelling coverage regarding your central AC unit.
Does Homeowners’ Insurance Cover Non-Central AC Units?
Typical homeowners’ insurance policies will cover window and wall-mounted (or ductless) AC units through personal property, or contents, coverage.
Contents coverage is like an insurance net that catches all your miscellaneous personal belongings. Things like electronic devices, shoes, books, furniture, and pretty much anything other than permanent installations have protection from covered perils.
You may not intend to ever remove a window or ductless AC unit after installing it, but it’s not considered a permanent installation. So, your contents coverage—not your dwelling insurance—covers your window AC unit in case of a covered peril such as theft.
As with your dwelling coverage, you’ll want to review your policy or speak to your agent to familiarize yourself with your contents coverage.
Water Damage Coverage and Air Conditioning
If one of the pipes in your central AC unit bursts and causes water damage in your home, most insurance providers will cover the parts of your home affected by the water.
However, your home insurance likely wouldn’t cover the repair of the AC pipe that started leaking unless the pipes burst for an unexpected reason that your policy considers a covered peril.
What Homeowners’ Insurance Doesn’t Cover Regarding Your AC
While there are several instances when damage to your AC unit is out of your control as a homeowner, others are your responsibility.
Home insurance will not help pay the cost of repairs or replacement for damage due to owner negligence. Insurance providers protect you from unexpected harm, but not harm you could have avoided.
For example, if you ignored your AC’s pleas for maintenance on its broken evaporator coils, your home insurance will not reimburse repairs.
Causes of AC damage that home insurance does not cover include:
- Lack of maintenance: Damage from not maintaining your HVAC (heating, ventilation, and air conditioning) system is not covered. As a homeowner, you can prevent AC damage, such as mold, by having regular inspections of your HVAC system, cleaning and replacing air filters, and dusting air vents.
- Bad installation: If your AC unit’s installers fastened something poorly or if a contractor serviced the unit improperly, you have the ability to notice and report the damage to the AC company before damage occurs.
- Normal wear and tear: Home insurance does not cover damage, no matter when your AC breaks down on its own. Today’s AC units are designed to last up to 20 years and will inevitably experience natural deterioration the more you use them.
- Accidents: Maybe you unintentionally rammed your wheelbarrow into the side of your outdoor AC unit. While you may not expect accidental damage to your AC as a homeowner, insurance providers don’t cover it because it’s too difficult to prove.
- Excluded perils: Your home insurance policy protects your AC unit from covered perils, but some perils, like floods and earthquakes, are usually excluded from home insurance policies.
- Pests: Rodents, termites, and other pests can cause physical damage to your AC unit. Most home insurance providers don’t protect against pests because you can catch infestations early and prevent damage.
Additional Air Conditioner Coverage
If you’re concerned about your AC’s wear and tear because of frequent usage or you want extra coverage, you have options beyond your homeowners’ insurance policy.
Your insurance agent is the best person to speak with to decide which of the two coverage types below make more sense to purchase for your circumstances.
A Home Warranty for Your AC
A home warranty is a contract that provides extra coverage for appliances and major systems that wear down over time, including your HVAC system. You can buy this kind of coverage from a home warranty company when you buy a new home.
This coverage is not air conditioner insurance, but it shares similarities. Just as home insurance has covered perils, a home warranty has covered failures. If your AC (or any other appliance, for that matter) malfunctions due to old age, you may be able to file a home warranty claim.
However, owner negligence and wrong installation still aren’t valid reasons for a home warranty to cover a broken AC unit. In other words, if you or someone other than Father Time is why the AC breaks, don’t expect warranty coverage.
While lenders may require you to buy home insurance before getting a mortgage, a home warranty is optional. It also differs from home insurance in that insurance covers only unforeseen losses, while a home warranty covers only service, repair, and replacement costs.
Paying for a home warranty is similar to paying for home insurance. There are terms (or limited coverage periods), monthly payments, and claims.
Equipment Breakdown Coverage: AC Insurance
Another type of coverage is equipment breakdown coverage, an endorsement (or extra coverage) on your home insurance policy for home appliances. In other words, it extends your coverage for an added cost to your premium.
Equipment breakdown coverage acts like insurance for your AC. It will protect against electrical and mechanical breakdowns due to unpredictable internal factors, like defective equipment, which your home insurance policy on its own lacks.
While a home warranty covers normal wear and tear, equipment breakdown coverage doesn’t. But both types of coverage are optional, so review your options thoughtfully when deciding whether to buy a plan.
Filing a Claim for Your AC Unit
When you report a loss to your homeowners’ insurance provider or home warranty company, ensure you’re informed to make the process run smoothly.
Keep in mind that the exact information you need to provide and the steps you have to take to file a claim depend on your home insurance provider or home warranty company.
How to Get Home Insurance to Pay for Your Air Conditioner
Your home insurance policy will have a deductible: a set amount you must pay before the insurance provider covers your costs.
Your insurance premium (or monthly payment) may increase when you file a claim. If the cost to repair or replace your AC unit is less or just above your deductible, paying out of pocket might make more sense.
Follow the steps below to file an insurance claim for your AC:
- Determine if the cost of repairs is worth filing a claim.
- Take clear photos of any visible damage to your AC unit.
- In the case of theft or vandalism, file and obtain a copy of a police report.
- Write down your AC unit’s model and serial number.
- File the claim by calling your home insurance provider or visiting the company online.
- Meet with a claims adjuster to evaluate the cost of repairing damages.
- Keep or copy your receipts for any repairs or replacements.
- Submit receipts to your insurance provider for accurate reimbursement.
How to File a Claim With a Home Warranty
Unlike an insurance claim, a home warranty claim involves having a contractor come to assess damages to your AC unit for a fixed service fee.
In general, the process is as follows:
- Call your home warranty company or visit its website to start the claims process.
- The company will send one of the contractors in its network to your home.
- The contractor will evaluate your AC unit’s damage and determine how much repairs will cost. They may also service or repair the AC right then and there.
- The contractor will send a quote to the home warranty company.
- Pay the fixed service fee.
- After the company receives the quote, it will pay for repairs or replacement costs within your coverage limits if the damage falls under your plan.
Protect Your Air Conditionally
Air conditioning is an important home component, just as your refrigerator, electrical system, and plumbing are. And while unexpected damage is, well, unexpected, you can prepare for it by understanding your home insurance policy.
When it comes to your home insurance coverage, it’s up to you as the homeowner to look at your circumstances from a bird’s-eye view and determine if you need more.