The best insurance products for high-value homes

Methodology

Insurance Business America has engaged the country’s top brokers in one-on-one interviews and surveys to determine the leading Home Insurance products. IBA’s inaugural Five-Star Excellence Award celebrates companies not only with outstanding product offerings, but also first-class broker support and industry knowledge. The Five-Star Excellence Award allows brokers to understand the partners their peers have chosen to present to clients – giving you an upper hand when selecting insurers to work with.

• Chubb
• Travelers
• Pure
• Safe Co
• AIG
• The Cincinnati Insurance Company

What is high-net worth home insurance?

Standard home insurance policies are designed to meet the coverage needs of a wider consumer market, meaning coverage is targeted at small and medium-sized homes and not catered toward high-value residential properties. Fortunately, many insurance companies also offer a specialized type of coverage for upscale houses.

High-net worth home insurance, also called high-value home insurance, provides coverage for properties valued at $750,000 or higher. These kinds of properties may include luxury and heritage homes or houses with special architectural or design elements. Such policies provide comprehensive insurance packages and higher coverage limits, and protect valuable items inside the property.

It is also worth noting that high-net worth home insurance coverage is not limited to houses. Many insurance providers also have policies for high-value condos in their portfolios.

What is considered a high-net worth home?

Properties valued at $750,000 or higher are considered high-net worth homes. These include heritage homes with construction features not typically found in older structures, and houses with unique architectural elements or made of materials that are not easily replaceable. Properties with luxurious features, including upscale outdoor living areas, swimming pools, guest houses, and intricate landscaping, and those containing expensive art or wine collections, jewelry, furnishings, antiques, appliances, fixtures, and other special items are considered high-value homes as well.

What is covered in a high-net worth home insurance policy?

High-net worth home insurance policies provide expanded coverage limits and additional benefits and services compared to standard home insurance.

For structural repair or replacement, for example, the cost of coverage is often guaranteed, allowing the policyholders to rebuild their homes to the original condition even if the costs go beyond the coverage limit. However, some policies limit replacement coverage up to a certain percentage.

Most high-value home insurance also pays for the replacement cost of personal belongings. Several home insurance companies provide a higher coverage limit for valuable items such as artworks, jewelry, collectibles, and business property at home. Another thing worth noting is that for most standard policies, it is 10% more expensive to insure possessions at the replacement cost than the actual cash value.

Some high-net worth home insurance policies also provide protection not commonly covered by standard homeowners insurance, including food spoilage, identity theft, lock replacements, and kidnap or ransom. These may also cover legal expenses beyond the policy limit.

Many high-value coverages offer protection for personal liability, including medical bills and loss assessments. A number of policies also extend protection to non-physical injuries such as defamation, libel, and slander.

What are the benefits of high-net worth insurance?

High-net worth home insurance offers several benefits and services not typically found in standard home insurance policies. These include extended or guaranteed replacement cost coverage, payment of living expenses while the property is being repaired or reconstructed, coverage for medical bills, and higher sub-limits for valuable items such as fine art and jewelry.

Some policies also offer coverage for business properties, computers and gadgets, family protection, identity theft protection, loss assessment, and water backup.

How much does high-net worth home insurance cost?

The price of high-net worth home insurance policies is often determined by the geographical location, the age and structural integrity of the home, the insured’s credit rating, and additional coverage for other valuables. High-value home insurance premiums are typically priced higher than the average $1,200 cost of standard home insurance policies.

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