Quick answer
Home value affects three things directly: which carriers will even quote the property, how the dwelling limit gets calculated, and what liability coverage makes sense alongside it. Standard carriers often cap dwelling coverage or decline entirely above a certain replacement cost, which is what pushes a home toward specialist carriers as value climbs. Higher-value homes also tend to carry higher-value contents and higher liability exposure, which is why umbrella coverage recommendations scale with net worth, not just with the house itself.
What home value does not do is set a fixed formula for what coverage should cost or look like. Two homes at the same appraised value can need very different policies depending on construction type, location, and what’s actually inside them, which is exactly why a full asset review looks at the specific property rather than applying a value-based rule of thumb.