What Is High-Value Home Insurance and Who Needs It?

A high-value home is typically defined as one that would cost more than $750,000 to completely rebuild. If you own a high-value home, you may need a high-value home insurance policy to go with it. Here’s a closer look at what high-value home insurance is, how this type of insurance policy works, and what it can cost to secure one of these policies.

What is high-value home insurance?

High-value home insurance is a specialized type of insurance tailored to high-net-worth homeowners whose properties would cost $750,000 or more to rebuild. It offers comprehensive coverage to protect the property and the home’s contents and provides liability protection in the event of an unforeseen incident.^[1]

What makes insurance for high-value homes different from standard homeowners insurance is the higher coverage limits. A standard home insurance policy has lower limits that may not be sufficient for high-value homes to cover their expensive fixtures or custom-designed features in the event of a covered loss. High-value home insurance has tailored coverage to meet the unique needs of luxury homes.

This custom coverage extends to the belongings in the home as well. Expensive possessions — like jewelry, art, and antiques — require higher coverage limits, and high-value home insurance provides that extra protection. It even provides higher limits for high-value personal property, including rare wines, antique cars, and private aircraft.

In addition to coverage for property damage and personal possessions, high-value home insurance policies offer more liability protection. Accidents and incidents can happen at any time, and people with a high net worth are often vulnerable to lawsuits. A high-value home insurance policy offers higher liability coverage to protect homeowners in the event of such a lawsuit.

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High-value home insurance costs by region

Where you live can greatly affect how much your home is worth and how much it would cost to rebuild. If your home costs more than $750,000, you may need to seek out a specialized high-value home insurance policy to make sure you have financial protection if the structure of your home or belongings are damaged.

For example, the average home value in the West region of the country is $607,638 — which is about double the cost of the average home in the Southeast, at $316,053. So why does it cost significantly less to insure a home in the West ($1,255 annually) than in the Southeast ($4,413 annually)? That may be because homes in the Southeast are at risk of more damage due to weather events in that region.^[2]

What does high-value home insurance cover?

It’s important to understand how a high-value home insurance policy will protect you. Generally, these policies may include the following types of coverage:

• Dwelling coverage

• Other structures coverage

• Personal property coverage

• Loss of use coverage

• Personal liability coverage

• Medical payments coverage

• Additional coverages, including kidnap, ransom, and extortion; home systems protection; and solutions to prevent future losses

• Policy perks, including risk consulting and choosing a case settlement

Most of these coverages are available in both high-value and standard homeowners insurance policies, but the difference with high-value policies is they tend to come with much higher coverage limits.

What does high-value home insurance exclude?

High-value home insurance typically excludes the following types of coverage:

• Earthquakes: This coverage may be available as an endorsement or a separate policy.

• Floods: You need to purchase this coverage separately through an insurer backed by the National Flood Insurance Program.

What factors affect the cost of high-value home insurance?

Many different factors can influence how much you’ll need to spend to secure high-value home insurance. These include:

• Your deductible: The lower your deductible is, the more you’ll spend each month on your homeowners insurance premium. It may be tempting to choose a high deductible to lower your premium costs, but if you do, make sure you pick a deductible you can afford to pay if you need to file a claim.

• Necessary building materials: If you traded tile countertops for marble and carpet for hardwood floors, you need to make sure you buy enough coverage to replace those higher-value materials in your home. This can increase the cost of your policy.

• Discounts you qualify for: Many homeowners insurance companies offer discounts that can help you save on your policy. If your insurance company also offers life, auto, or business insurance, you can typically bundle those policies together to save. Being retired can also lead to a discount since you’ll be home more and able to prevent disasters like fires from growing too large. Some employers and professional organizations also team up with insurance providers to offer discounts.^[3]

• Your credit score: Having a higher credit score indicates that you’re less likely to file an insurance claim, which can lead to lower premium prices.

• How disaster ready you are: Another way to qualify for discounts is to make your home more resistant to disasters. This could include improving the strength of your roof and adding storm shutters to your home.

High-value home insurance costs by state

Again, where you live can affect how much it costs to insure your home. For example, the average cost of high-value homeowners insurance is just $2,430 per year in Vermont but costs $32,863 in Florida. That’s 1,252% more!

For additional context, the following table shows the average annual costs of standard homeowners policies and high-value policies in each state.

Best companies for high-value home insurance

The insurance company you choose to work with can also affect your premium costs. You can see by reviewing the following table how prices can differ among the five best high-value home insurance companies.

Cincinnati Insurance

Founded in 1950, Cincinnati Insurance is a subsidiary of Cincinnati Financial Corporation. It offers a variety of insurance products to both people and businesses. With an A.M. Best rating of A+, the company is financially strong and maintains a stable outlook.^[4] Cincinnati Insurance is the most affordable high-value home insurance option on average.

AIG

AIG, or American International Group, traces its roots back to 1919 and is a multinational insurance corporation that offers a wide range of insurance products as well as retirement and investment solutions. The company has an A.M. Best financial strength rating of A and scored 809 out of 1,000 in the J.D. Power 2020 U.S. Home Insurance Study, indicating high levels of satisfaction among its customers.^[5],^[6] AIG is particularly well known for its coverage for high-value homes and collections, as its coverage can exceed policy limits.

Pure High-Value

Pure High-Value is a member-owned insurer catering to high-net-worth individuals and families, offering coverage options specifically designed for their lifestyles and belongings. With an A.M. Best rating of A+, the company is financially strong and maintains a stable outlook.^[7] Pure is particularly recognized for its coverage of high-value homes and art collections, offering agreed-value coverage for items (think jewelry and luxury cars), full rebuild or repair for covered losses, and a wide range of risk-management services.

NatGen Premier

NatGen Premier, a subsidiary of National General Holdings, provides car insurance, home insurance, and roadside assistance services for high-net-worth people. The insurer has an A.M. Best rating of A+ and has received high customer satisfaction ratings from J.D. Power, scoring 748 out of 1,000 in 2020.^[8],^[6] NatGen Premier is the best fit for homeowners who also own luxury cars, as this insurer is known for its robust coverage of luxury and high-performance vehicles.

Chubb Prestige

Chubb Prestige, a division of Chubb Insurance Company of North America, offers insurance policies and services to high-net-worth individuals and families. Chubb has a long history in the insurance industry, with roots tracing back to 1882, and is best known for its stability and strong financial position, holding an A.M. Best rating of A++.^[9] The insurer received a J.D. Power score of 809 out of 1,000 in 2022.^[10]

Methodology

To evaluate home insurance companies, Insurify data scientists and editorial team analyze multiple factors that reflect a company’s quality, reliability, and financial health. We consider industry ratings and information from sources like A.M. Best, Standard & Poor’s, Moody’s and Fitch, and J.D. Power. We evaluate customer service and satisfaction data, customer reviews, NAIC complaint indexes, claims payout rates, company reputation and proprietary quoting data.

Who needs high-value home insurance?

Anyone who owns a home worth $750,000 or more can likely benefit from buying high-value home insurance. No matter how much your home is worth, you need to make sure you buy the right amount of coverage to rebuild your home from the ground up if you need to.

How to buy high-value home insurance

To ensure you’re getting the most comprehensive and affordable coverage for your needs, it’s helpful to follow these three steps when buying high-value home insurance:

1. Research different insurance companies. Look for highly rated companies with a reputable history of providing excellent service to their customers. You also need to evaluate the different types of policies and additional coverage options offered by each company to determine which ones meet your specific needs.

2. Choose the type and amount of coverage. To determine how much coverage you need, take an inventory of your personal belongings and assess the replacement value of your home to ensure that you’re adequately covered in the event of a loss. You should also consider any additional coverage options that may be relevant, such as flood insurance or earthquake coverage, depending on your location.

3. Compare quotes. Once you’ve chosen the type and amount of coverage you need, the next step is to get quotes from multiple insurance companies. You can use an online comparison platform to make this process seamless and easy to manage. That way, you can quickly review quotes from different insurers and compare the policies side by side to identify the most affordable and comprehensive coverage that fits your budget. The goal here isn’t to find the cheapest policy possible, but the best price for the right amount of coverage.

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