Selling Sunset: How Much Does It Cost to Insure a $75 Million Home?

In the third season of Netflix’s Selling Sunset — which follows a real estate brokerage called the Oppenheim Group that specializes in luxurious Los Angeles homes — Davina scores a listing for a $75 million mansion in Beverly Hills. 

It’s 18,000+ square feet on a one-acre lot, has a pool, guesthouse, movie theatre, gym and a wine cellar. Unfortunately for Davina, the house is widely acknowledged to be overpriced. It features no view (an LA essential for high-value mansions) and is right off a busy street. And along with a mortgage, potential buyers would also need to consider taxes and insurance. 

David W. Clausen, CEO of Coastal Insurance Solutions, estimates Davina’s $75 million listing would cost an additional $3.5 million per year in home insurance.

Here’s why.

California dreamin’ for $3.5 million 

Many factors play into the cost of a home insurance premium, like the cost to rebuild, local risks and hazards, personal claim history and credit score — the same factors that influence your own home insurance bill. Despite the $75 million market value, the cost to rebuild the home is the biggest factor the insurance policy is based on. 

“For example, if the home was destroyed in a fire — how much would it cost to reengineer the home, remove all of the burnt materials and rebuild? In many cases, it costs more to rebuild a luxury home than it does to build one from scratch,” says Clausen. 

[ Read: The Best Home Insurance Companies of 2020 ]

Calculating that cost typically involves a consultation with the original builder and an inspection from the insurer’s risk management team, but Clausen used his experience insuring high-value homes to give us an idea. He estimates $37 million to rebuild, imagining it costs $2,000 per square foot

Then you’d need to factor in the catastrophic risk potential. For this home, the number is higher because of its location. “The catastrophic risk potential in California makes it a unique environment for homeowners insurance — especially for homes with over a $5M rebuild cost in high-risk wildfire zones,” adds Clausen. 

Keeping up with the hazard zones 

Southern California homes have earthquake and wildfire coverage to consider. Clausen points out that this 90210 property sits in a “very high fire hazard zone.” According to Clausen, depending on the hazard coverage and how the insurer assesses that risk, the policy could range from $220,000 a year to $3.5 million per year.

Clausen also told us that the California home insurance market is particularly difficult. Many insurers have left the market, making premiums rise amongst existing insurers. In 2018 insurers paid over $13 billion in losses from wildfires. 

“It makes it difficult for insurers to stay in the California market because, in many cases, they are unable to charge enough premium to match the risk. Eventually, the insurers stop writing new policies and decide to pull out of the state because they have sustained such heavy losses and can’t make an underwriting profit,” says Clausen.

Beverly Hills homebuyers have to contend with more than a high price tag if they’re considering the star home of Selling Sunset — millions more will need to be factored in for insuring the home. Good luck, Davina!

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Image Credit: Bulgac / Getty Images

Danika Miller

Personal Finance Reporter

Danika Miller is a personal finance reporter at The Simple Dollar who specializes in banking, savings, budgeting, home insurance, and auto insurance. Her reporting has also been featured at,, and elsewhere.

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  • Andrea Perez
    Andrea Perez
    Personal Finance Editor

    Andrea Perez is an editor at The Simple Dollar who leads our news and opinion coverage. She specializes in financial policy, banking, and investing.