If you are like most financially successful individuals, you may have a great deal of wealth invested in your home. Typical homeowners insurance policies may not be suitable for your situation. If you have a high value estate with expensive furnishings and valuables, you may need specialized insurance to cover your investments for damage or loss.
Independent agents in the Trusted Choice® network understand the exclusive needs of high net-worth individuals and can provide information about high value home insurance policies that are available to you. Because of the many relationships these agents establish with top insurance companies, Trusted Choice independent agents can provide you with a selection of policies at competitive rates. Contact a local agent today for personalized service and quotes tailored to your needs.
Traditional Homeowners Insurance Policies May Not Be Enough
- Traditional homeowners policies typically place caps of $1,000 to $2,000 each on coverage for items such as furs, silver, jewelry and fire arms.
- Purchasing separate riders on these items may only increase your full coverage to $10,000 for each category of personal belongings.
- Homeowners policies typically limit the cap on contents coverage at 50% to 70% of your home’s value. This is typically not high enough for high-wealth individuals and collectors.
What Constitutes a “High Value Home”?
When it comes to high value home insurance, how do you know whether or not your home is a candidate for this type of policy? Some insurance companies may offer high value home insurance to customers who own homes greater than $300,000 in value, though most require that the home be worth at least $750,000, and others begin offering high value home insurance for estates valued at $1 million or more.
Home values and prices vary throughout the country and insurance companies differ in their coverage requirements. While one company may require a higher valuation than your home’s current value to obtain high value home coverage, another may provide coverage to you. So it pays to shop around a bit before you purchase a policy. If you feel that your home and its contents exceed the normal caps for standard home insurance carriers, you may want to discuss high value home insurance with a Trusted Choice independent agent who can help you determine your needs and find you a suitable insurer.
Do Luxury Homes Need Special Insurance?
Owners of high value homes tend to have non-residents, including staff and guests, in their homes. With many high value items on display, luxury home owners may be more concerned about loss due to theft than other homeowners. Burglars often also see high risk but high reward opportunities when targeting these homes.
Additionally, when you have very expensive luxury items such as custom stained-glass windows from Italy, a wine cellar stocked with Chateau Lafluer wine from France, and fine woven Persian rugs, you may have a difficult time convincing a typical insurance company of their value following a loss, particularly if they are items that appreciate rather than depreciate in value.
To ensure that you are fully covered for the actual value of your high-end items, and that you can rebuild your home in the event of a catastrophe, you need to have an elite home insurance policythrough a company that understands your unique coverage needs and will value your belongings as much as you do.
How Is High Value Home Insurance Different?
High value home insurance provides all the coverage offered by traditional homeowners policies and more. In the event that a large portion of your home is damaged and needs to be rebuilt, high value home insurance will allow you to rebuild your home to its previous state or value.
Additionally, a typical homeowners policy will have caps on contents coverage for different categories of items. If your personal belongings exceed that amount, you need to purchase separate endorsements, or insurance “riders,” to cover the additional value. If you have an extensive list of luxury items that need additional coverage, the limits on the endorsements may still not be high enough. With high value home insurance, you can receive full coverage without the need to purchase several endorsements, which will save you money in the process
Coverage Options for High Value Home Insurance
High value home insurance providers understand that your coverage needs extend beyond the typical structure and contents coverage you expect from a traditional policy. They will offer several other coverage options that can provide full coverage for all your needs.
- Excess liability and umbrella liability coverage: Unfortunately, when people of wealth are responsible for injuries to others, victims may see it as an opportunity to collect large sums of money. Having excess liability insurance will provide you with the full coverage you may need to handle lawsuits, including hiring the best possible legal advisors and paying any fines and restitution that may be required.
- Liability insurance to cover domestic help: If you have domestic help, you will want to have additional liability coverage to cover medical expenses if anyone should be injured on the job or while in your home. This coverage will extend to include your employees’ lost wages while they are unable to work, as well as any damages if you are sued and deemed responsible for their injuries.
- Flood insurance: Traditional homeowners insurance policies do not provide coverage for flood damage. This coverage, which is provided by the National Flood Insurance Program, is available through independent agents. However, high value home insurers understand that the NFIP will not provide coverage anywhere near the amount needed by high value home owners, so most will provide flood insurance coverage as part of their insurance package.
- Identity theft insurance: Identity theft is a crime that is becoming more rampant each year. A person with a pristine credit report and high net worth may be more of a target than the average person. If you become a victim of identity theft, you may need legal representation to clear your credit and good name. This insurance will cover some portion of the costs you might incur if you are a victim of this crime.
- Kidnap and ransom insurance: Hopefully, you will never need to use this coverage, but because wealthy individuals are lucrative targets for criminals hoping to collect ransom, this coverage can assist you in the event of such an incident and will also cover the cost of hiring an expert negotiator so you can do everything possible to protect your loved-ones.
- Coverage for 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 coverage you need.
- Medical coverage for your pets: Some high value home policies will extend to your pets. This coverage will provide medical insurance policies to cover vet bills and may even cover boarding for your pets if your home becomes unlivable due to a disaster.
How Do Insurance Companies Determine Property Values?
Luxury home insurers will usually send an expert appraiser to your home to view, assess and document your high-value contents such as jewelry, artwork, collectibles, antiques and custom materials and construction. If you disagree with any values assessed by the appraiser, you can request that a second appraiser be sent to view your belongings, or you may appeal it by providing your own expert assessment.
Your coverage needs can change over time as you redecorate, renovate or buy valuable items for your home. Therefore, your insurer may want to conduct periodic assessments. It is a good idea to conduct reviews of your home insurance coverage at least once every five years.
Let an Independent Agent Assist You –
Cherie Johnson, PLCS
TWFG Insurance Service
1095 Evergreen Circle, Suite 200
The Woodlands, Texas 77380