If you own a home on Nantucket, you already know the island doesn't play by normal rules. The same goes for insuring your property. Between sky-high rebuilding costs, mandatory wind deductibles, and carriers fleeing coastal markets, getting the right coverage here requires navigating challenges that mainland homeowners never face.
Here's what makes Nantucket insurance different: you're dealing with the most expensive home insurance county in Massachusetts, construction costs that can hit $1,200 per square foot, and a shrinking pool of insurance companies willing to write policies. The good news? Once you understand what you're up against, you can make smart decisions that protect your investment without overpaying.
Why Nantucket Home Insurance Costs So Much
Let's start with the number that matters: Nantucket homeowners pay an average of $3,052 per year for home insurance, compared to the Massachusetts state average of around $2,008. That's not a typo. You're paying roughly 50% more just because of your zip code.
The island's coastal location drives much of this premium. Insurance companies look at your proximity to water and calculate the risk of storm surge, hurricane-force winds, and flooding. Every Nantucket property sits in a high-risk zone from their perspective. Wind coverage alone carries mandatory deductibles of 2% to 5% of your dwelling coverage—all but four insurers in Massachusetts require this for coastal homes.
But the real shock comes from rebuilding costs. Construction costs on Nantucket reached approximately $1,200 per square foot in 2024, and even conservative estimates put it at $450 per square foot or more. If you have a 2,500 square foot home, full replacement could cost $1.125 million to $3 million. Meanwhile, the average home sale price hit $4.86 million in 2024, but that market value has nothing to do with what it costs to rebuild after a total loss. You need coverage based on construction costs, not what your house would sell for.
Understanding Wind Coverage and Deductibles
Here's where Nantucket coverage gets tricky. Your standard homeowners policy includes wind damage, but it comes with a separate, much higher deductible than your regular policy deductible. While you might have a $1,000 deductible for most claims, your wind deductible is calculated as a percentage of your dwelling coverage.
Let's say you insure your home for $2 million in dwelling coverage with a 3% wind deductible. If a hurricane tears off your roof, you're responsible for the first $60,000 of repairs before insurance kicks in. That's a substantial out-of-pocket expense, and it's why understanding your wind deductible matters as much as your premium.
Some carriers offer fixed-dollar wind deductibles instead of percentages, and others let you choose between the two. If you can afford a higher premium to lower that wind deductible, it's worth considering—especially if you'd struggle to come up with tens of thousands of dollars after a major storm.
Admitted vs. Surplus Lines Coverage
You might discover that standard insurance companies—called admitted carriers—won't insure your Nantucket home. This is becoming increasingly common as carriers pull back from coastal markets. When that happens, you'll need to turn to the surplus lines market.
Admitted carriers are licensed in Massachusetts, file their rates with the state, and participate in the Massachusetts Insurers Insolvency Fund that protects you if they go bankrupt. Surplus lines carriers operate differently. They're not licensed in Massachusetts, don't have to get their rates approved, and don't participate in the state guaranty fund. The trade-off is flexibility—they can insure high-risk coastal properties that admitted carriers reject.
Before you can buy surplus lines coverage in Massachusetts, you must be rejected by admitted insurers first. This is a legal requirement. Your agent will document these rejections, then work with a surplus lines broker to find coverage. Expect to pay more—surplus lines policies typically cost more than standard insurance. But for many Nantucket homeowners, it's the only option available.
One important note: while surplus carriers don't participate in the state guaranty fund, insolvency rates for surplus lines insurers have remained historically low. Still, verify the financial strength of any surplus carrier before buying coverage.
Flood Insurance and Other Essential Coverages
If you take away one thing from this guide, let it be this: flood insurance is not optional on Nantucket. Your homeowners policy explicitly excludes flood damage. When storm surge from a hurricane floods your first floor, your homeowners insurance won't pay a cent.
Flood insurance in Nantucket averages $1,781 per year for about $340,000 in coverage. You can buy it through the National Flood Insurance Program (NFIP) or private flood insurers. Private policies often offer higher coverage limits than NFIP's $250,000 cap on dwelling coverage, which matters when your rebuilding costs are in the millions.
Beyond flood insurance, you should seriously consider ordinance or law coverage. This pays for the extra cost to bring your home up to current building codes after a covered loss. Nantucket has strict building requirements, and if you need to rebuild after a fire or storm, you'll likely be required to meet standards that didn't exist when your home was originally built. These upgrades can add hundreds of thousands to your rebuilding costs.
Getting the Right Coverage for Your Island Home
Start by getting a professional replacement cost estimate. Don't guess at rebuilding costs or rely on what your home would sell for. Construction on Nantucket is expensive and getting more so—costs jumped significantly in recent years due to labor shortages and the logistics of getting materials to the island.
Work with an agent who specializes in coastal Massachusetts properties. They'll know which carriers are still writing new policies on Nantucket, what the current wind deductible options are, and whether you'll need to go through the surplus lines market. They can also help you understand the true cost differences between admitted and surplus coverage.
Review your coverage annually. The Nantucket insurance market is tight right now, with carriers limiting coastal exposure and premiums rising. What was available last year might not be this year. If your current carrier non-renews your policy, you'll need time to find replacement coverage—don't wait until the last minute.
Insuring a home on Nantucket is complicated and expensive, but it's also essential. Between the island's exposure to coastal storms, extraordinary rebuilding costs, and a challenging insurance market, you need coverage that's specifically designed for your unique risk profile. Take the time to get it right, work with experienced professionals, and make sure you understand exactly what you're paying for—and what gaps might exist in your coverage.
