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.
If you have a high-value estate you will need specialized insurance to cover your property and assets, as well as your higher liability risks.
In some cases, you may need multiple policies to fully cover all facets of the home – structure and contents.
The coverage
High-value home insurance has a broader coverage and higher limits than normal homeowner’s insurance policies can offer.
It is designed 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 many 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:
Better dwelling coverage — These policies will reimburse you for home repairs that are above the listed amount on the policy. This is crucial if you have a home with hard to find or imported materials that are costly and not readily available.
Some policies include an option to cash out if the home is destroyed. In those cases the insurer would make a payment, allowing the policyholder to rebuild somewhere else.
Better contents coverage — Policies will have higher contents coverage limits than a standard homeowner’s coverage. Some policies have high jewelry coverage of up to $150,000 and special coverage for antiques, art and collectibles if they are broken or damaged.
Replacement cost — Traditional homeowner’s policies will give you an option of choosing actual cash value or replacement cost. Actual cash value takes into account the depreciation of your furnishings.
But high-value coverage will usually include replacement cost coverage, which reimburses you for new items to replace the damaged ones.
Flood insurance — Traditional homeowner’s insurance 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 can often include flood insurance, as well as coverage for sewer backups.
Living expenses coverage — Most policies provide generous coverage for living expenses. The limits are either a stated dollar amount or a two year limitation coverage for vacation homes. Many insurers will allow you to include coverage for other structures, including pool houses and vacation homes.
Some final tips
It is expensive to cover theft or loss in a high-value home, 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.
Also, if you make any upgrades to your home, you should 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.
