Does Homeowners Insurance Cover Damage from Power Surges?

Power surges are sudden spikes in electrical voltage that can damage appliances electronics and wiring in your home. When a power surge strikes, you may be left with destroyed TVs, fried computer equipment, and even electrical fires.

But does your homeowners insurance cover surge damage? What about damage to specific devices or wiring inside your walls?

This guide examines how power surge damage is handled by home insurance, including:

• What causes surges and the types of damage they create
• What coverages apply if a surge damages your possessions or home’s structure
• Special cases like utility company surges and artificially generated spikes
• Steps for filing an insurance claim after surge damage
• Tips to reduce your risk of power-related damage

Read on to learn if your homeowner’s policy protects you when an electrical spike impacts your residence.

What is a Power Surge?

A power surge also called a voltage spike, occurs when there is a sudden brief increase in voltage on your home’s electrical system. This surge of excess energy can travel through outlets and wiring, damaging electronics and appliances plugged in at the time.

Surges are usually caused by:

• Lightning strikes – Nearby lightning can introduce excess voltage from the strike.

• Issues at the power company – Local grid and infrastructure problems can cause surges.

• Failing wiring – Outdated, overloaded, or faulty wiring may trigger voltage spikes.

Surges can be localized to a single outlet or widespread across your home’s electrical system. The excess voltage can destroy electronics, ignite fires, and damage wiring inside walls and appliances.

How Might Home Insurance Cover Power Surge Damage?

Standard homeowners insurance includes several coverages that may reimburse surge damage, depending on your policy and cause of loss:

• Personal property – If a surge destroys electronics, appliances, or other possessions, your personal property coverage (Coverage C) would pay for these damaged or destroyed items, up to your limits.

• Dwelling coverage – If the spike impacts wiring inside walls and causes electrical fires, your dwelling coverage (Coverage A) would cover repairs.

• Additional living expenses – If a surge-caused fire displaces you from your home, loss of use coverage would pay hotel and restaurant costs.

• Liability protection – If faulty wiring on your property causes a surge that damages a neighbor’s electronics, liability coverage would protect you.

However, details vary between insurance companies. Let’s look at some common surge scenarios and how coverage would apply.

Does Home Insurance Cover Surges Caused by Lightning?

Lightning is one of the most common causes of power surges. When lightning strikes near your home, it can introduce excess voltage through electrical and telephone lines. This voltage spike then surges through your outlets and appliances.

In most home insurance policies, lightning is considered a covered peril. So if a lightning strike causes a power surge that destroys your TV, computer, or other electronics, your personal property coverage would likely reimburse you for these items.

Coverage is subject to your deductible and policy limits. Make sure you have enough coverage for all your valuables if you live in an area prone to electrical storms.

What About Surges Caused by the Power Company?

Utility company issues are another major source of power surges. Grid and infrastructure problems like fallen poles, faulty transformers, or maintenance mishaps can cause spikes.

Whether you’re covered for utility company surges depends on your home insurer:

• Covered cause of loss – Some insurers classify surges caused by a utility as a covered peril, similar to lightning. Damage would be covered subject to your policy limits and deductible.

• Not covered – Other insurers may exclude off-premises surges caused by the power company. This would leave you with no coverage from your home policy.

If your power company caused the surge, contact them to see if they have a claim process. Some utilities offer surge protection programs or insurance funds to cover damages.

Check your policy language to see which approach your insurer takes for off-premises surges. Call your agent if you have any uncertainty.

Does Insurance Cover Surges from Artificial Currents?

Artificially generated power surges occur due to issues at local utilities. For example, a spike could happen when a power company performs maintenance, load shifting, or other grid switching.

These human-created surges fall into a grey area with homeowners insurance:

• Covered, but limited – Some insurers cover artificially generated surges, but exclude damage to specific components like tubes or transistors inside appliances. Only exterior damage is covered.

• Not covered – Other carriers classify artificial surges as not covered. Damage from human-generated spikes would not be reimbursed.

Check your policy language and exclusions for how your insurer handles surges from artificial currents. Call your insurance company with any questions.

What About Interior Wiring and Structural Damage?

When a major power surge impacts your home, it can cause fires, melt wires inside walls, and create serious structural damage beyond just destroying electronics.

Your home policy would provide the following coverages in this type of worst-case surge scenario:

• Dwelling coverage – To repair melted wiring, damaged wall outlets, and other structural electrical issues.

• Additional living expenses – If you’re displaced from an electrical fire caused by the surge.

• Liability protection – If faulty wiring on your property propagates the surge to a neighbor’s home.

Make sure you carry adequate dwelling and liability coverage in case a surge creates major home damage or legal liability.

How to File an Insurance Claim for Power Surge Damage

If a power surge impacts your home, document all damage thoroughly before contacting your insurer. Be prepared with:

• List of damaged items – Note all appliances, electronics, and personal property affected by the surge. Include purchase dates and estimated replacement costs.

• Photos/video – Capture visual evidence of the damaged electronics and wiring.

• Repair estimates – Get quotes to fix any structural wiring damage caused by the surge.

Provide this information when you file a claim. An adjuster may visit to inspect damages before settling your claim. Make sure to ask about your policy coverage, deductible, and payment limits as they apply to your surge damage.

Tips to Prevent Power Surge Damage

While homeowners insurance may reimburse power surge damage, prevention is always preferable. Here are some tips to avoid surge destruction:

• Install whole-house surge protectors at your electrical panel. They can deflect excess voltage.

• Use surge protector power strips for all electronics. Replace strips every 2 years.

• During lightning storms, unplug devices and turn off/disconnect sensitive electronics.

• Make sure your home electrical system can handle the load. Upgrade if needed.

• Replace old outlets, wiring, and electrical panels that may propagate surges.

• Consider dedicated surge insurance if you live in a lightning-prone area.

Frequently Asked Questions

What if the power company caused the surge, but my policy excludes off-premises damage?

Contact your utility provider to see if they have a claims process or surge protection program to cover damages. Some will reimburse surge claims, even if your home insurer does not.

My insurer only covers external appliance damage from artificial surges. What can I do?

Use high-quality surge protector power strips for electronics. Quality strips often provide their own warranty against internal damage to components caused by surges. Just make sure to properly install and frequently replace the strips.

What’s the best way to prevent surge damage during a lightning storm?

Unplug sensitive electronics and turn off major appliances before and during electrical storms. Stay vigilant, as a lightning strike can occur many miles away but still induce a surge. Avoid using landline phones, electrical items, and plumbing fixtures while lightning is active nearby.

If I make a claim for electronics damaged by a power surge, how is the reimbursement calculated?

Insurers will pay replacement cost value up to your applicable limits. This means the current cost to replace with a similar new item. Save receipts and track purchase dates to prove the original value of damaged electronics.

The Bottom Line

Power surges can wreak havoc in your home. But homeowners insurance policies often provide coverage when surges damage or destroy your personal property or home wiring and structure.

Just be aware that coverage varies based on your insurer and the cause of the surge. Lightning and off-premises utility issues fall into grey areas. Carefully read your policy language and talk to your insurance company about surge protection.

Prevention is the best medicine when it comes to power surges. Install whole-house and local surge protectors, unplug devices during storms, and keep your home wiring updated. Take these steps, review your insurance coverage, and you can rest assured knowing you’re protected if an electrical spike impacts your residence.