What Is High Value Home Insurance?
One in twenty homeowners submits a home insurance claim every year. Every home insurance plan is meant to address a variety of issues that may happen in the home. From fires to natural disasters, home insurance is there to support homeowners in times of crisis.
But, in order to take advantage of home insurance, you need to make sure that you have the right home insurance plan.
Specifically, you need to know whether or not you need high-value home insurance. These kinds of plans can offer more in terms of coverage because they are meant for pricier houses and higher net-worth families.
To learn more about high-value home insurance, keep reading. We have everything you need to know.
High-Value Home Insurance Definition
High-value home insurance is meant for homes that are worth $750,000 or more. If you have a million-dollar home or are close to it, you need to consider investing in high-value home insurance.
This kind of homeowners insurance also covers houses that are heritage homes or have special architecture. If the home has something unique or significant, it could be worth investing in high-value home insurance.
This kind of homeowners insurance can also apply to condos, townhomes, and other expensive properties, assuming that they meet the financial or historical guidelines.
Because it covers more expensive homes, high-value home insurance is comprehensive. This means that it provides more coverage than typical homeowners insurance.
Usually, more expensive properties also come with more expensive items in them. You probably wouldn’t find the same furniture in a $100,000 home that you would find in a $1,000,000 home.
Because of that, high-value home insurance has to consider all of the expensive items that may be in the home itself. To cover these items, you’re going to need an over-arching insurance plan that can take care of all of the items that you own.
How High-Value Home Insurance Works
High-value home insurance works differently than average homeowners insurance.
Standard homeowners insurance does the following:
- Repairs or rebuilds the structure of your home if it’s damaged
- Replaces any stolen or destroyed possessions, usually taking depreciation into account
- Pays for any lawsuits that you may file as a result of bodily harm or property damage
- Pays for potential living expenses you may have while living away from home during the time or repairs
This level of coverage is great. But, it’s usually not enough for high-value homes.
Standard insurance policies like these have limits. They will help with repairs and other expenses up to a certain amount.
Since more expensive houses require more expensive repairs, it’s likely that any damage done to a high-price home would be too expensive for a standard plan. This is why people with more expensive properties should invest in high-value home insurance.
High-value insurance provides the same coverage, but with higher limits. High-value plans also provide additional coverages for homeowners who have unique needs for their properties.
What High-Value Home Insurance Covers
High-value home insurance is a better choice for individuals who have a more expensive home, because of the higher coverage limits. Specifically, this kind of home insurance places higher limits on the following:
- Structural repair or replacement
- Personal possessions
- Liability coverage
- Living expenses
First is structural repairs and replacements. Standard coverage is usually limited to the cost of the home.
However, repairs can be more expensive than the price of the house. So, many people end up paying out of pocket if they have a more expensive home that goes beyond the coverage limit.
This is why high-value insurance has extended or guaranteed replacement cost coverage. With guaranteed coverage, the insurance will cover all costs for repairs and replacements even if those costs are higher than the limit. Extended coverage simply raises the limit that homeowners insurance places on costs.
Next is possessions. People with more expensive homes generally have more expensive possessions. With that being the case, higher limits and broader coverages are standard on high-value plans.
Similarly, there are higher liability coverage limits with high-value home insurance. This includes higher limits for personal liability, medical payments, and loss assessments.
Lastly, this kind of insurance will also provide more coverage when it comes to additional living expenses that you may have while you’re waiting on repairs. This allows you to find and afford a place that can match the standard of living you had in your home.
Special Coverage for High-Value Home Insurance
Some high-value insurance policies cover more than others. Commonly included are the following:
- Vacation and/or second home coverage
- “All Risks” coverage for personal possessions
- Deductible waivers for large losses
- Kidnapping, ransom, and extortion coverage
- Risk management services
If you feel that you’d like to have these protections, it’s worth investing in a high-value home insurance plan.
These kinds of additional protections are not offered with traditional home insurance plans.
Investing in High-Value Home Insurance
Not everyone needs high-value home insurance. Even if your home is worth a million dollars, you may not need it.
So, you should consider investing in this kind of home insurance if one or more of the following apply:
- The home that you’re insuring is worth $750,000 or more
- The home that you’re insuring is a heritage home
- The home that you’re insuring has unique construction features that are not commonly found today
- You have expensive appliances, decorations, fixtures, and other design elements that you cannot easily replace
- You own expensive items (jewelry, rugs, art, etc.) that you keep inside of the home that you’re insuring
- The home that you’re insuring has unique design features (guest house, living area, swimming pool, landscaping, etc.)
When in doubt, it may be time to evaluate your options on high-value home insurance by contacting our office for a comprehensive review of your current coverage.
We can help you figure out if there’s a better policy out there for you. We can also take additional coverage recommendations into consideration if those apply to you.
Gathering more information about your insurance plan can’t hurt. It’s better to protect yourself now than wish you had in the future if something goes wrong.
The Cost of High-Value Home Insurance
High-value home insurance protects a great deal: your home, your belongings, and much more. The limits are high, and sometimes there are no limits on coverage.
As you’re shopping around for insurance, you should consider the limits of the policies that you’re looking at. Compare these to the worth of your belongings. As these policies have high limits, it’s likely that you’re covered.
If high-value home insurance protects expensive things, the cost of high-value home insurance has to be outrageous, right?
Luckily, this isn’t necessarily the case. Of course, high-value home insurance policies are more expensive than standard policies. If you own a high-end home, you should budget several thousand dollars per year for the annual premiums that come with high-end home insurance. The national average cost is between $3,564 and $5,550.
Lowering Home Insurance Costs for High-Value Home Insurance
The first price tag that you see doesn’t have to be the one that you go with. Just like all other insurance plans, you should consider multiple options.
This means that you need to shop around with insurers in your state. And that’s where we come in. At Gessel & Associates, we work with numerous highly rated insurance companies, and we are experts in getting you the best possible coverages for the best possible price.
A policy from a small company may be more expensive, but it may also be able to offer more coverage in return. You’ve got to find the sweet spot that gives you the coverage that you want at a reasonable price.
We also recommend that you consider going with a high deductible if you don’t think you’ll have to use your home insurance too frequently.
A policy with a high deductible will lower the amount of money that you’re paying to the insurance company annually. And, if a problem does come up, it’s likely that paying the deductible is still going to save you money overall since you’ve been paying less upfront.
You may also want to think about bundling your home and your auto insurance, as most high-value home insurance carriers will require you to insure your autos as well. It’s likely that you can save 5% to 15% on your premium.
Lastly, you should be looking for all available discounts. You may be able to get a discount if you’re a retiree, a veteran, a student, a healthcare worker, or belong to some other group or organization. Our agents are trained to inquire about and apply all available discounts.
Get High-Value Home Insurance
If you’ve read this far, it’s likely that you’re thinking about high-value homeowners insurance. You may have an expensive house, expensive belongings, or something else.
Whatever it is, we can help you protect it. Our team here at Gessel & Associates can help you find the insurance policy that’s right for you. Check out our insurance solutions today and find out what the best choice for you is. We can’t wait to get started!