How Does Insurance Work For High-Value Homes?

Rebuilding luxury homes is an expensive endeavor. Some home insurance firms offer specific plans for homes whose rebuilding costs exceed $750,000. Even if your insurer covers your high-value house with a basic homeowners insurance policy, you can typically choose supplemental coverages, such as extended replacement cost coverage, which doubles the amount of coverage you have to rebuild your property after a covered loss.

Many home insurance providers accept properties with values up to $5 million, although some insurers demand specific insurance for homes surpassing $750,000. For properties with a replacement cost of $850,000 or more, some providers demand an interior assessment in addition to the normal exterior inspection. Your policy's dwelling replacement amount may be increased based on the inspection results to guarantee adequate coverage.

Frequently, owners of luxury properties have insurance considerations that owners of less expensive homes do not. Here are just a few ways you can secure your property, valuables, and assets if you own a high-value home:

While many conventional plans only cover your goods for their real monetary value, homeowners can choose replacement cost coverage for their personal property. Personal property coverage with replacement cost will increase your premium, but it will pay to replace goods damaged by a covered peril without depreciation being considered.

Homeowners insurance provides coverage if you are legally accountable for another person's injuries or property damage. If your net worth exceeds the maximum amount for liability coverage limit of your policy, you can acquire an umbrella policy to protect your assets, often for an additional $5 million.