A power surge is a temporary spike in electricity. It is dangerous because electrical wires and appliances are designed to operate within specific voltages and currents limits, and exceeding the limits may damage them or cause an electrical fire. A surge protector detects a surge and cuts off the electricity before the spike has time to cause damage.
Common power surge protectors are meant for protecting single electrical circuits, which means they only work for internal power surges. A whole house surge protector, however, is meant to protect all electrical systems in the house in the event of a power surge; they protect against external power surges.
Where It's Installed
In order to protect the whole house, a whole house surge protector cannot be installed in a circuit inside the house. Instead, it's installed in the main electrical panel since all electricity used in the house must pass through the panel. The installation project should not be a DIY project; its best installed by a residential electrician if it is to offer complete protection for the house.
Dangers it May Protect You From
Anything that produces an electrical power surge has the potential to damage your electrical systems and appliances or even burn down your house; these are what the whole house power surge protector will shield you from. Here are a few examples of causes of such dangers:
Lightning is actually a huge electrical arc emitted then the electricity in the sky is discharged to the ground. A typical lighting strike may contain thousands, if not millions, of electrical volts. If such a huge voltage of electricity is discharged into your electrical system, it can cause a gigantic surge and serious damage if you don't have a surge protector.
Trees Falling on Power Lines
If a tree or tree branch falls on electricity lines and causes contact between two or more wires, it may cause a serious power surge. This type of power surge is common during storms, but a whole house power surge will protect you from them.
Animals in Transformers
Small animals such as rodents or snakes sometimes get caught up in electrical transformers. If such an animal damages a transformer or causes a short circuit in the transformer, it may cause a power surge.
Power Resumption after Blackouts
Sometimes, after a blackout, the power may come back at a high voltage than the one you normally get in your house. This is one of the reasons it's advisable to unplug electrical systems during a blackout, but a whole house power surge can also protect you from such power surges.