Abram Interstate Insurance Services, Inc., CMGA

Helping Independent Insurance Agents Since 1996

Why High Value Homes in CA Have Such High Ticket Replacement Costs | Insurance Product Highlight

Published on September 25, 2018

wholesale insurance high value home CA CMGA Abram

There’s a great deal that goes into building a High Value Home, and because of that, there’s a great deal that goes into insuring it as well.

First and foremost, these High Value Homes have more intricacies — custom finishes, specific materials and construction methods that make the replacement value higher. In California, it’s well known and understood that our housing market pricing is above and beyond most other places in the country. A lot of the real estate market-value of a home is determined by things like location, supply and demand, and the value of the land itself. But, the actual cost to rebuild these houses is a substantial factor as well.

An article from NPR affiliate, KQED reported on this factor earlier this year:

Land, Labor and Raw Material Costs Are Higher in California Than the Rest of the Country. And Those Costs Are Rising.

Construction labor and the cost of the raw materials have been rising over the last five years, and are higher in California than other parts of the country. According to the Legislative Analyst’s Office, construction labor is about 20 percent more expensive in major California cities than in the rest of the country.

On the labor side, a shortage of skilled construction workers bears much of the blame. When the housing market crashed in the late 2000s, construction workers left the industry in droves. And those same workers haven’t come back.

Building codes and environmentally friendly design requirements in many California cities require different types of raw building materials to be used, some of which can be pricier than elsewhere in the country. And nationwide, the cost of vital resources like lumber and concrete are on the upswing.

The materials, methods, and the artisan construction and detail needed to replace these High Value Home Risks are what make the replacement costs as “high value” as the real estate market says they are.


While these risks may be daunting, you shouldn’t turn them away because Abram is here to help you! In California there’s a sizable market for you to write this line of business. These high net-worth clients will often return to you with other lines of business for you to write if you have handled their home well. While Personal Lines might not even be your main focus as an Insurance Agent, learning how to market for and cover these High Value Homeowner risks can lead you into the kinds of business you do focus on in lucrative ways.

We at Abram Interstate are here to help you secure the kind of High Value Home Insurance Coverage these homes need. We know you can handle these risks well with the right attitude and effort. It’s a viable market in California, so start marketing for it now.

Our Wholesale High Value Homes Insurance Product

  • Limits From $1,000,000 to $50,000,000
  • All Protection Classes Available
  • HO-3 Form with Extended Replacement Cost
  • 70% Personal Effects Coverage Available / Scheduled Personal Property
  • Personal Injury / Inflation Guard / Increased Ordinance or Law
  • Water Back up Coverage Available
  • Air Bnb / Seasonals / Secondary Homes
  • In Home Business Coverage Available
  • Equipment Breakdown/ Service Line
  • Named Insured as Trust, LLC, or Corporation
  • Identity Fraud / Eco Coverage

Fill Out Your ACORD Homeowner Application HERE Now.

Submit Completed Apps to apps@abraminterstate.com today!

Abram Interstate Insurance Services, Inc. is a California wholesale insurance broker (CMGA) that has licensing and expertise to place business in both admitted and non-admitted markets for personal lines insurance and commercial lines insurance in California and surrounding areas.

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