Property · Insurance Term
Blanket Limit (Blanket Coverage)
Definition
A blanket limit is a single property insurance limit that covers several buildings, locations or types of property together, instead of a separate limit for each one. It lets a large loss at one location draw on the combined limit, subject to the policy's conditions.
In Plain English
With a scheduled limit, each building has its own limit. If one is underinsured, the extra limit on another building cannot help. With a blanket limit, the total is shared, which can protect you if one building's value was set too low.
Insurers usually require a signed statement of values to write blanket coverage and may require agreed value or a higher coinsurance percentage. Many also add a margin clause, which caps recovery at any one location to a percentage of that location's reported value.
Blanket coverage is common for multi-property owners and portfolios. Accurate values per building still matter, both for pricing and because a margin clause ties recovery back to what you reported.
Not sure how your policy handles this? Have us review it, or get a quote.
Example
Hypothetical: an owner insures three retail buildings with reported values of $2M, $3M and $5M under a $10M blanket limit. A fire destroys the $2M building, which actually costs $2.4M to rebuild. Without a margin clause, the blanket limit could pay the full $2.4M; with a 110% margin clause, recovery would be capped at $2.2M.
What to Watch For
- Ask whether a margin clause applies and at what percentage.
- Keep each building's reported value current, even under a blanket limit.
- Check whether coinsurance or agreed value applies to the blanket.
- Confirm which property types the blanket includes: building, contents, business income.
Common Questions
Is a blanket limit always better than scheduled limits?
It often gives more flexibility, but margin clauses and value reporting rules can limit that benefit. Compare the full terms, not just the structure.
Can a small owner with two buildings get a blanket limit?
Sometimes, depending on the insurer and the properties. Ask your agent to quote both ways.
Last updated October 14, 2026 · Primesure editorial team · How We Write