Blanket Insurance – Types, Advantages & How To Get

Blanket insurance is designed to cover multiple forms of property within the same area, identical types of property across various locations, or various kinds of property across two or more locations.

Blanket Insurance - Types, Advantages & How To Get

It provides coverage for both personal belongings and the physical structure, effectively bringing together all the possessions of the policyholders under a single policy.

This essentially means that blanket insurance also safeguards personal belongings within a dwelling. Additionally, consumers have the option to procure and tailor blanket health insurance according to their needs.

Furthermore, businesses can opt for blanket insurance to protect multiple residential, rental, or commercial properties. However, only if they have stringent health insurance requirements or own multiple homes might they discover that purchasing individual policies is more suitable.

How Does It Work?

Blanket insurance offers a broad spectrum of coverage compared to individual policies. While it may incur higher costs, the additional covered risks typically justify the investment.

Homeowners insurance functions as a type of blanket insurance, providing coverage for both the structure and contents of a home against loss.

Furthermore, for landlords with multiple apartment units, blanket policies offer a consolidated coverage limit for all properties. The total amount payable under the policy is distributed among all the properties.

Likewise, franchise owners operating various fast-food eateries at different locations can opt for a blanket policy to cover all their stores under one policy.

Moreover, consumers also have the option to secure blanket health insurance, although customization may be necessary to meet their specific needs.

Types Of Blanket Insurance

While blanket insurance is often associated with commercial property, various types of blanket insurance policies are available. They include:

Homeowners, Condo, And Rental Insurance

This policy offers blanket insurance as a favorable choice for individuals searching to enhance the limits for particular types of personal property. Standard policies typically impose specific limits on items such as art, jewelry, and other valuables.

By incorporating blanket coverage, these limits can be increased for such personal property. Generally, these categories of personal property are subject to relatively low sub-limits and are treated separately from the overall personal property amount covered by the policy.

Car Insurance

Blanket auto insurance is not available for private passenger vehicles. Instead, comprehensive car insurance offers coverage for your vehicle in cases of theft, vandalism, storm damage, or similar incidents.

However, this type of policy typically only pays for vehicle repairs and does not cover theft or damage to items inside your car. Personal property kept in your car is generally covered by your homeowner’s or renter’s insurance policy.

Business Property Insurance

Business property insurance is where blanket insurance is most frequently encountered. This occurs as it allows for the coverage of multiple locations, buildings, and business personal property items under a single blanket policy.

Typically, this option is particularly beneficial for landlords or businesses with numerous locations.

However, the covered locations must involve similar operations if multiple locations for the same business are being insured under the blanket policy.

Homeowners Association Insurance

Homeowners associations (HOAs) typically maintain a blanket policy to cover all the common areas accessible to unit owners.

These regular zones may include facilities such as a clubhouse, playground, basketball court, or event venue building accessible for rental.

The fees paid by condo unit owners or HOA members in a neighborhood contribute to funding this blanket insurance since the insured items are considered common areas.

Lastly, these common areas provide coverage against perils to cover the costs of repair or replacement up to the specified limit.

Health Insurance

Blanket health insurance is an uncommon situation, but often in the form of accident policies covering groups of individuals, such as a football team.

However, numerous recreation leagues and non-profit organizations choose to secure accident plans for their policyholders.

How Much Does Blanket Insurance Cost?

The cost of each type of blanket insurance policy varies and is determined by various factors. While certain premium factors, such as the amount of coverage, are common across blanket policies, others may be specific to the policy type.

For instance, in homeowner’s policies, the applicant’s insurability is assessed based on their claim history and creditworthiness. However, these factors, along with others unique to each policy type, influence the overall premium calculation.

Advantages Of Blanket Insurance

When contemplating blanket insurance, several factors might prompt you to consider purchasing a policy. Here are a few:

Comprehensive Coverage

Blanket insurance provides extensive coverage compared to certain other policies. For instance, it can cover various farm equipment pieces that wouldn’t originally be protected under a standard homeowner’s policy.


A blanket policy provides simplicity by allowing various homes or properties to be covered under one policy, with a single coverage limit, deductible, and coinsurance, rather than having to buy numerous policies.


A blanket policy provides increased flexibility. Some policies allow you to add or remove property at any time or adjust coverage levels, eliminating the need to purchase a new policy each time.

Reducing The Risk Of Underinsurance

With a blanket policy, there’s less chance of facing high out-of-pocket costs due to underinsurance. These policies often provide higher and more flexible coverage, mitigating this risk.

Cost Efficiency

While a blanket policy may come with a higher price compared to a homeowner’s policy, it can ultimately be more cost-effective.

This is because it covers various properties and items under one policy, eliminating the need to purchase multiple policies.

Catastrophe Protection

In the event of a catastrophe, like a tornado damaging multiple properties simultaneously, a blanket policy provides invaluable protection.

With such a policy, all properties can be covered under one claim, simplifying the process and ensuring comprehensive coverage.

Disadvantages Of Blanket Insurance

While a blanket policy offers numerous advantages, it’s essential to also consider potential disadvantages. Some of the disadvantages of blanket insurance include:

Insufficient Coverage

The coverage provided by a blanket policy may not be adequate if the insured properties are not accurately added or updated. Additionally, certain perils, like floods, may not be covered.

Underestimation Of Value

Unlike regular homeowner’s policies that value homes by replacement cost, blanket policies may offer inadequate coverage if the value of dwellings and property isn’t properly assessed.

Complexity In Filing Claims

Filing claims on multiple items, such as houses and business equipment, may require separate claims, leading to complexity in the claims process.

Higher Premiums

Blanket insurance policies entail higher premiums compared to homeowner’s policies due to the broader coverage and multiple risks covered.

Policy Exclusions And Conditions

While blanket policies offer comprehensive coverage, certain situations, like floods or earthquakes, may not be covered due to policy exclusions.

Dependence on The Insurance Company’s Discretion

Blanket policies may depend on the insurance company’s discretion, leading to potential coverage limitations.

For instance, if property from one business is located on another business’s premises. The company may not cover all damaged property in a claim.

How To Get Blanket Insurance

To secure a blanket policy, you can follow the steps below:

Evaluate Your Insurance Requirements

Review your circumstances to determine if a blanket policy aligns with your needs. A blanket policy could be advantageous if you own multiple rental properties, businesses, equipment, or assets at home that aren’t protected by your homeowner’s policy. Nevertheless, it’s important to accurately assess the worth of your residence and belongings to obtain an exact quote.

Explore Insurance Companies

Not all insurers offer blanket policies, so focus your search on those that do. Furthermore, explore the companies for qualities such as stability, claim processing efficiency, and customer service ratings.

Collect Essential Information

When requesting a quote, the insurance company will require various types of information, including personal details, property and belongings, the policies needed, and other data. Having this information readily available will expedite the process and enhance the accuracy of the quote.

Compare Quotes And Coverage

Upon receiving your quotes, carefully assess each to determine the best option. However, it’s important to consider factors like premiums, coverage amounts, deductibles, limitations, and exclusions when making your decision.

Review Your Policy

After the insurance company completes and submits an application, the underwriting department will assess it and may ask additional follow-up questions. Once the policy is approved, it’s essential to thoroughly review it to confirm that it aligns with your expectations.

Submit The Premium Payment

Typically, an insurance provider only activates coverage for a blanket policy once the policy has been approved and the premium paid. Therefore, it’s important to make the first premium payment promptly to guarantee coverage.

Lastly, Keep Accurate Records

After the policy takes effect, it’s essential to maintain records of any improvements and equipment purchases.

Some policies may necessitate contacting the insurer within a specific timeframe, typically thirty days, to add, remove, or modify coverage or covered items.

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