Glossary

Blanket limit

A single property limit applied across several buildings, locations or types of property, so the insurer pays a loss at any one up to the total.

Also called: blanket insurance, blanket coverage, blanket limit of insurance

A blanket limit is one dollar amount of insurance that covers two or more buildings, locations or kinds of property, instead of a separate limit on each. Say a retailer owns three stores valued at $2 million, $3 million and $5 million and buys a $10 million blanket limit. A $4 million fire at the largest store can be paid in full, which a scheduled $5 million limit on that building would not allow.

Blanket coverage is flexible when values move between locations, but insurers price that flexibility. Expect a coinsurance requirement, commonly 90%, or an agreed value endorsement. Many carriers also attach a margin clause (ISO CP 12 32), which caps what is paid on any one item at a stated percentage of its reported value, such as 110%, regardless of the blanket total.

Everything rests on the statement of values. If one location is understated, coinsurance is tested against the combined values, so underreporting hurts every location, not just the one that burned. Blanket limits also don't remove sublimits for things like outdoor signs or valuable papers. The guide on agreed value and blanket limits shows how to choose between scheduled and blanket limits, and statement of values explains how to build the worksheet.

Last reviewed October 10, 2026

In the index now

Related terms

Agreed value A property policy option where insurer and insured agree on the covered value in advance, which suspends the coinsurance penalty for the agreed period. Statement of values A schedule listing each insured location with its building, contents and income values and construction details, used to rate and model a property program. Coinsurance A property policy condition requiring you to insure to a set percentage of value, or share the loss. (Health plans use the word for a cost share.) Insurance to value Carrying a property limit that matches the full value of what you insure, so a loss is paid in full and no coinsurance penalty applies. Sublimit A lower cap on what a policy pays for one coverage, peril or item, set beneath the policy's overall limit.

Related guides

Agreed value, blanket limits and margin clauses How agreed value suspends coinsurance, how a blanket limit spreads one limit across locations, and how a margin clause caps the payment at each building. The statement of values: what property underwriters need How to build a statement of values underwriters trust: the fields, ISO construction classes, replacement cost basis, and how errors in it surface in a claim. The coinsurance clause and how underinsurance is penalized How the coinsurance formula works, with worked penalty examples for buildings and business income, and four ways to avoid an underinsurance penalty. Commercial package policies: when a BOP is too small A commercial package policy combines separate coverage parts under shared declarations and conditions. When values, locations or class outgrow a BOP. The endorsements small businesses most often need The endorsements contracts and coverage gaps most often call for, with ISO form numbers: additional insured, waiver, primary, ordinance or law and more. Construction cost inflation and your property limits How rising rebuilding costs create underinsurance, the 2026 cost indexes to watch (Verisk 360Value, BLS PPI) and how coinsurance and agreed value respond.

Related industries

Farm and ranch insurance Farm policies versus commercial coverage, crop insurance, equipment and livestock, workers' comp exemptions by state, H-2A rules and agritourism statutes.

Related en español

Seguro de equipo de contratistas: herramientas, maquinaria y equipo rentado El seguro de equipo de contratistas es una póliza flotante de transporte terrestre para herramientas y maquinaria fuera del taller: cobertura, valuación y robo.