How to Buy High Net Worth Homeowners Insurance
Standard homeowners insurance policies often don't provide enough coverage if you have a high net worth. Your net worth refers to the total amount of your assets after taking into account all your outstanding debts. To obtain sufficient protection against unwanted events, you can obtain special high-net-worth homeowner's insurance. You usually have to meet a minimum level of house value or net worth to qualify for such a policy.
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Need
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About 90 to 95 percent of wealthy individuals have insufficient insurance coverage, especially when it comes to major threats, according to Bankrate. When you have an expensive home, you lose more value if something bad happens to it. With more risk comes a pressing need for specialized insurance policies. For example, if your home is worth $10 million, a common renter's policy will not provide enough coverage if a fire or an earthquake destroys the building's structure.
Providers
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Insurance companies that provide standard policies often don't offer the kinds of products that high-net-worth individuals need. To get enough coverage, you have to approach companies that specialize in insuring the wealthy and have appropriate products. According to Bankrate, the top companies in the industry include ACE, Chartis, Chubb, Fireman's Fund and Privilege Underwriters Reciprocal Exchange.
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Features
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High-net-worth homeowners insurance provides protection against a wide variety of threats, including plumbing problems, electronic appliance failure, damage to alarm systems, stolen or misplaced jewelry and even injuries to pets. If anything should completely destroy your home, you may be able to get enough reimbursement to cover the entire rebuilding cost. When choosing your policy, carefully consider the amount of deductible, which is the amount you will pay out of pocket if a loss occurs. Higher deductible amounts lead to lower insurance premiums. High-net-worth homeowners insurance policies may offer deductibles as high as $250,000 or $300,000.
Application
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To get a high-net-worth homeowner's insurance, you usually have to meet a company representative in person so he can analyze the value of your home and design an appropriate policy for you. The company may require that your home meets a certain minimum value, for example $1 million. Depending on the company, you may be able to obtain a no-obligation price quote before you talk to a company representative. You may also contact the company to schedule an appointment with a company representative.
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References
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