Your High-Value Insurance Guide

High-value insurance is a segment of personal lines insurance that targets and caters to the insurance needs of individuals with a higher net worth and more tangible assets to protect. There are insurance carriers and products that are specifically designed to fit the mold for these more complex risks.

What makes up a high-value client?

There is no black and white line to cross to get into high-value territory. This is something that can vary slightly from state to state or from one insurance provider to another. The most common trigger used for access to high-value insurance products is the replacement value of your primary residence. If your primary home would cost at least $1M or more to build, then you are likely to have access to specialized products and services through a high-value-appointed independent agent. There are other factors that might qualify an individual, such as the value of the client’s vehicles, jewelry, or unique liability exposures or needs.

When it comes to high-value clients, the agent must have a detailed understanding of the client’s situation. These clients are likely to have certain aspects of their home and auto insurance that require special care and attention. High-value insurance companies are often able to accommodate clients who have expensive collections of jewelry and fine arts, multiple residences, or domestic staff such as a housekeeper maid or a nanny. High-value carriers are also great for homes that are very large and/or custom-built. If your home is filled with custom archways, molding, wood cabinetry, wood flooring, travertine or marble, it may be a good idea to look at the high-value insurance options.

What is guaranteed replacement cost?

Guaranteed Replacement Cost is an option that most high-value insurance companies will offer in the majority of states, to be sure that a client’s home can be fully replaced with materials and designs of the same kind and quality as the original in the case of a covered loss, regardless of the coverage level initially agreed upon. Again, these clients usually have very custom and unique homes, so it’s a very real concern to make certain there’s enough coverage to replace the home with comparable materials and workmanship, in the event of a total loss. Having Guaranteed Replacement Cost coverage puts those concerns to rest. If rebuild costs exceed the dwelling limit on the policy, the insurance company will continue to pay out to be sure that the home is replaced as it stood before the loss.

It’s worth noting that guaranteed replacement cost is only an option when the insured and the insurance provider agree upon a reasonable dwelling limit on the initial policy. Once that baseline has been established, any damage to the home will be paid for, even when the loss amount exceeds the coverage amount listed on the policy.

How do high-value carriers help with auto insurance?

High-value carriers typically prefer clients to have both their home and auto insurance policies with the same company, and sometimes require that they control the auto coverage to offer an umbrella policy. Again, these clients typically have special insurance needs, and the insurance provider wants to be sure they understand and properly protect the client’s property and liability interests in a holistic fashion. Just like with home insurance, high-value carriers typically have a good amount of flexibility in what they may consider eligible for coverage. High-end luxury, or exotic vehicles that are typically not accepted elsewhere are often commonplace for the high-value carriers, and routinely covered by them. It can be very difficult to insure a Ferrari, Maserati, or Bentley with a standard insurance provider, but high-value carriers do this routinely for their clients. Fundamentally, they insure vehicles differently than the standard markets. Instead of setting vehicle values at their depreciated, or market value, at the time of a claim, the high-value carriers will offer an “Agreed Value” settlement option to specifically list on the policy, so that clients know in advance how much they would receive in the event of a total loss. They take a similar approach to providing coverage on motorcycles, watercraft and even jewelry; using this Agreed Value settlement option to simplify and streamline the claim process.

Overall, high-value carriers are going to be able to account for most situations as long as the agent has a complete understanding about what the client owns and the way that they use them. You may notice that the conversation and process for getting policies set up is a little longer, and a bit more detailed when working with these high-value carriers, and that’s by design. Instead of an automated, black box underwriting approach, high-value underwriters are individually and holistically underwriting the entire risk and the account. There’s also an underwriting period during which an underwriter who specializes in these types of accounts will review the risk, along with the client’s profile. And while the process often takes a bit longer, it typically enables them to offer extremely competitive terms and rates; often beating the standard markets in both broader coverages and more attractive pricing. In some instances, depending on the size and complexity of the account, these underwriters may also have flexibility with some coverages and rates, and a good, experienced high-value agent will be able to negotiate favorable terms on behalf of clients and find the best possible offer across these specialty high-value carriers.