Blanket Insurance

What is Blanket Insurance?

Blanket insurance is a single property insurance policy that covers more than one type of property at the same location, the same kind of property at multiple locations, or multiple kinds or property at two or more locations. It covers personal possessions as well as the actual dwelling, "blanketing" all the homeowners' possessions.

How Blanket Insurance Works

Blanket insurance usually offers a broader set of protections than a typical individual policy. Although it's more expensive, the additional covered perils often make it worth the investment.

Blanket insurance is fairly common in everyday life. Homeowners insurance is a type of blanket insurance, as it covers both the structure and the contents of your house against loss. For landlords that own multiple apartment units, blanket policies can provide a single limit for all properties.

The maximum amount payable under the policy is divided among all the properties. Meanwhile, franchise owners that own several fast-food restaurants at different locations can buy a blanket policy to cover all their stores under one policy with a single limit.

Consumers can purchase blanket health insurance — although they might need to customize the policy to meet their unique needs. If someone has an adult parent living at home, they may not be considered a dependent under an individual health plan. However, purchasing blanket health coverage may allow someone to place their parent on their health insurance, regardless of tax designation.

It's important to examine a prospective blanket insurance policy closely and compare it to conventional policies to see what you would get for the extra cost.

Who Needs Blanket Insurance?

Individuals who don't own multiple properties, and don't have complicated health insurance needs, probably don’t need a blanket insurance policy. It will probably be more cost-effective to pursue individual policies and add riders as necessary. If someone has multiple properties that need to be insured — whether residential, rental, or commercial — a blanket property insurance policy may be ideal.

Any type of blanket policy, such as blanket medical insurance, needs to be evaluated on a case-by-case basis. That's why it's important for consumers to work with a knowledgeable insurance agent who can customize a package of coverages that fit unique needs a person might have.

Since blanket insurance will typically cost about 10% more than conventional policies, it's important for someone to get it only if they need it. However, for the right people, bundling insurance into a blanket policy can often save money.