The more your home is worth, the trickier it is to make sure that it and all of its contents are covered properly and that you are not paying too much premium.
First off, a typical homeowner’s insurance policy may not be suitable for your home. If you have a high-value estate with expensive furnishings, décor and collectibles, you will need specialized insurance to cover your property and assets for damage or loss.
Also, you may sometimes need multiple policies to make sure that all facets of the home ― structure and contents ― are insured to a level that you are comfortable with.
What’s a high-value home?
Most insurers will consider an estate worth more than $750,000 a candidate for high-value home insurance. For others, it’s $1 million or more.
What’s considered “high value” will vary depending on the insurance company and the region in which you live. It pays to work with us to find the right policy choices for your home.
The coverage
High-value home coverage essentially goes beyond what a typical homeowner’s policy will cover.
These policies include broader coverage and higher limits than normal homeowner’s insurance. They are designed specifically for homes that are worth millions of dollars and typically contain state-of-the-art media equipment and technology, costly appointments and furnishings, extensive collections of art and any other luxurious items of great value.
Coverage options
High-value home insurance companies will often work with you to tailor your policy to your needs. With this bespoke approach, you can add certain coverages that would not normally be available on a typical homeowner’s policy, such as:
Guaranteed full replacement cost — Most standard homeowner’s policies don’t guarantee full repair or replacement in the event of a major loss. High-value home insurance typically covers these costs. If after a total loss the insured doesn’t want to rebuild the home, a standard policy would not pay out. But many high-value home policies give the equivalent of the replacement cost in cash.
Excess liability and umbrella liability coverage — If you are a high-net-worth individual and find yourself involved in an accident that results in an injury to a third party, you could be in for an expensive lawsuit. Having excess liability insurance will provide full coverage for lawsuits, including hiring the best possible attorneys and paying any settlements or restitution that a court may order.
Flood insurance — Traditional homeowner’s policies do not provide coverage for flood damage. For the most part, homeowners have to buy this coverage from the National Flood Insurance Program. But a high-value homeowner’s policy will often include flood insurance, as well as coverage for sewer backups.
Living expenses coverage — Most high-value home policies provide generous, if not essentially unlimited, coverage for living expenses.
Vacation homes — Many insurers will allow you to include coverage for other structures, including pool houses and vacation homes. By combining this coverage into one policy, you can save money while maintaining the full cover you need.
Keeping your policy up to date
It is expensive to cover theft or loss in a high-value home, for example, because the items in these properties are typically more costly.
Being in a gated community and/or having a security system in place at your home can significantly reduce risks, and insurance companies will often discount your premium based on this. Keep them up to date on any such changes.
When you make any upgrades to your home, you may want to update your policy by having a new insurance appraisal.
You should also keep track of all your new purchases in terms of furnishings and technology.