Owning an expensive home can be a dream come true, whether it is a property with historic significance or architectural beauty. At the same time, owning such a home can ignite a myriad of insurance challenges. You must be prepared to handle the complexities with the price, the higher personal liabilities, and the immense personal property limits.
Experts say that many expensive homes are underinsured by as much as 20%, because a lot of homeowners want to save money on insurance costs. When you own a high-value property or a luxury home, it can be tough to attain affordable household insurance. If the home is worth more than $1 million, the insurance company is taking a bigger risk in case something happens to the property. The extra precaution results in hefty insurance premiums for the homeowners.
For expensive homes, you want a comprehensive insurance policy that caters to your residence as well as your valuables. Your high-end home insurance coverage might introduce additional features specifically designed to protect expensive properties. The expanded coverage means you’ll most likely have to dole out higher monthly insurance premiums. However, there are many steps you can take to ensure that your high-end homeowners insurance remains affordable.
Are you planning to get homeowners insurance for your expensive home? Here is what you need to know about this type of insurance policy:
What is High-End Homeowners Insurance?
High-end home insurance refers to a policy dedicated to protecting expensive homes. As a rule of thumb, you might consider getting high-end home insurance when your property is valued at $1,000,000 or more. However, there are many other variables to consider besides the market price of your property. Your home’s value is also determined by its replacement cost, which is the amount of money to rebuild your property, contents coverage and debris removal.
The high-end home insurance comes with numerous features that specifically appeal to homeowners of expensive properties. A notable benefit of high-end home insurance is its significantly higher coverage limits. Ideal for homeowners with high net worth, these increased coverage limits will allow you to insure more items of substantial value.
Other features may include bundling the insurance policies to cover a secondary home, as well as coverage for detached structures like pool houses or gazebos. Generally, you can expect to find many customizable coverage options available for high-end home insurance. The aim is to give homeowners plenty of flexibility when it comes to insuring their affluent lifestyles.
Should I Get High-End Homeowners Insurance?
Keep in mind that not every home requires a high-end homeowners insurance policy. A standard home insurance package provides more than adequate protection for many homeowners in Canada. In fact, your regular home insurance coverage already offers ample protection for your personal belongings.
The high-end home insurance becomes pivotal when traditional policies fail to cover all your assets adequately. Although a standard insurance policy is robust, it isn’t custom designed to accommodate the prosperous lifestyles of high net-worth individuals. For homeowners with lots of expensive assets, they will need much higher coverage limits than what is offered by traditional home insurance.
You might be a good candidate for high-end home insurance when you need more bandwidth to insure the following items:
- Antiques & historic artefacts
- Expensive paintings & sculptures
- Wine collection
- High-end electronics
- Luxurious memorabilia
In addition, many expensive homes have luxurious interior or exterior design features that are beautiful, exclusive, and custom-made. They may include a lavish swimming pool, a specially curated landscape with exotic plants, or a unique architectural arrangement that makes your home stand out. Since these unique fixtures are not easily replicated, the costs of replacing them often exceed what traditional insurance packages can provide.
With high-end home insurance, your coverage is extendable to accommodate the different types of add-ons and enhancements in your luxury home. This ensures every part of your beautiful property, along with all your prized possessions, can be fully protected by the insurance policy.
Costs of High-End Homeowners Insurance
Due to the extended coverage limits and personalized perks, high-end insurance packages come with greater costs than their traditional counterparts. On average, homeowners are likely to incur more expensive insurance premiums. However, there are ways to mitigate the costs, making your high-end homeowners insurance more affordable.
Luxury homes are frequently the targets of burglaries for obvious reasons. As such, insurance providers want to encourage home security to help reduce the risks. Discounts are often made available for homeowners who adopt extra protection measures, such as installing a state-of-the-art security system. The home alarm is an encouraging sign for insurers, adding a layer of protection to your home and belongings.
Similarly, you might be eligible for discounts with certain upgrades to your luxury home. These could include fire alarms, smoke detectors and deadbolt locks. Like the home security system, these items give insurance providers the reassurance that your property is protected.
Are you interested in getting home insurance? A high-value home insurance broker can walk you through the process, explaining your coverage options in greater detail. At Keller & Associates Insurance Brokers, our home insurance policies can accommodate your lifestyle seamlessly. Contact us and we’ll connect you with the best home insurance products for your needs.