Homeowners with luxury homes with a higher value have a tough time getting them insured. This is because any standard homeowners insurance policy does not provide enough coverage to insure these expensive properties and highly valued possessions.
This is where high-value home insurance policies come into the picture.
These policies offer higher coverage limits and better protection for all valuables, assets, and residents.
So without wasting much time, let us look at what high-value home insurance is, what type of coverage it offers, and who needs it. For more details about home insurance in Ontario, you can always get in touch with an insurance broker at Surex.
What is high-value home insurance?
High-value home insurance policy is a homeowners policy that has been exclusively designed for all properties worth more than $750,000 to $1 million and above. Even though these policies are similar to a standard home insurance policy, they offer better and unique benefits for all the policyholders. This is because high-value homes have slightly different requirements.
The term “high-value” applies to the house or property, not the insurance. For example, if you have a standard home in a risky area, you will need higher levels of coverage, but you will still be getting a basic or a standard home insurance policy. On the other hand, high-value home insurance in Ontario is only for all homes that are worth more than a million dollars.
What are the different types of coverage that high-value home insurance offers?
Usually, the type of coverage varies depending on the insurance provider. However, just like a standard home insurance policy, high-value home insurance also offers different coverages. Some of them are:
Coverage type A / dwelling coverage
High-value home insurance policy will offer more than 1 million in dwelling coverage. A standard home insurance policy will only cover your dwelling for a specific amount listed on your policy’s declaration page. On the other hand, a high-value home policy will offer much more coverage. The insurance policy will also pay for extended replacement costs for your dwelling and the other structures. So you will also be reimbursed for any house repairs much above the amount listed on the insurance policy.
There is also an additional advantage. You also get a ‘cash out’ option. This option allows you to use the insurance check received from the company and build your house elsewhere.
Coverage type B / other structures coverage
This type of coverage covers all the repair costs for other structures apart from the main residence, such as fences, storehouses, and sheds.
Coverage type C / personal property coverage
High-value homes tend to have expensive paintings and artifacts. This coverage will pay for all the contents of your high-value property in the event of a disaster or a loss.
Coverage type D / loss of use coverage
With this coverage, you will get paid for any additional expenses if the damage makes your primary residence uninhabitable for the time being. This includes your temporary hotel/motel and food bills. However, many insurance providers restrict this amount to a pre-agreed amount per day.
Coverage type E / personal liability coverage
It may sometimes happen that a guest may get injured while on your property. Personal liability coverage will cover a third person’s medical bills or property damage if you are responsible.
Coverage type F / medical payments coverage
This coverage will be for any minor medical expenses of your guest.
Benefits of having a high-value home insurance policy
Even though there is a huge difference between a standard and a high-value home insurance policy, the latter offers numerous additional benefits.
Identity theft coverage
Even though identity theft coverage is pretty uncommon, it can be an excellent addition. This is because many criminals tend to steal identities and benefit from high-value assets.
Cash benefits
Some high-value home insurance policies may also offer cash benefits for extensive damage if the policyholder wants to rebuild his house at another location.
For example, let us consider that your high-worth home has been completely destroyed due to a fire or tornado. Your high-value home insurance policy will pay you enough money to rebuild the entire house from scratch. However, you might not want to rebuild your home at the same location due to unfavourable conditions. In that case, some insurance policies may also allow you to cash the cheque and rebuild the property anywhere you want.
Extensive property coverage
Most common home insurance policies will only pay for your personal belongings like furniture and clothes. However, in most cases, the amount provided is quite limited. So variable items like jewelry, art, antiques, or guns will require additional coverage.
However, when you get a high-value home insurance policy, all these expensive items are covered. This insurance policy will also pay to replace an entire pair or set if there is damage to one item in a pair.
Additional increased coverage
With high-value home insurance in Canada, you can expect benefits that go beyond a standard insurance policy. Some additional coverages that you can expect are:
- Increased coverage for replacing plants and shrubs in your garden
- Automatic coverage for sewer backup
- Better medical payment limits for a third person or a visitor
- Removal of debris and fallen trees
- Flood insurance: Most standard home insurance policies do not offer flood insurance; it has to be taken separately as an add-on. However, some high-value home insurance policies automatically offer flood insurance and other benefits.
- You can also include any second homes, like vacation homes, within the policy.
- Some insurance companies may also offer personal kidnap ransom and extortion coverage. This includes coverage for the ransom money, the reward for the culprits if they are found or arrested, professional services to handle negotiations with the kidnappers and delivery of the ransom amount.
- Deductible weavers
Your guide to high-value home insurance — Endnote
Getting home insurance for a high-value property is essential, and you must not ignore it. In case of an unexpected event, high-value property insurance will help you bounce back on your feet quickly and also help you rebuild the house without facing heavy loss.
