What it does
Blanket insurance applies one limit to two or more buildings, building and contents, or contents at more than one building or premises. Normally any loss can draw on the whole blanket limit. CP 12 32 adds a Margin Clause. For each building, and for contents at each building or premises, the maximum loss payable is the scheduled percentage times the value shown on the latest statement of values reported to the insurer.
Key provisions
- If the statement of values does not list each building and its contents separately, the insurer determines individual values from the reported totals before applying the percentage.
- Actual payment is still subject to the limit, coinsurance, deductible and valuation conditions. It cannot exceed either the margin-clause cap or the blanket limit.
- The margin clause does not increase the blanket limit.
Who sees it
Insurers add it to blanket programs to protect against understated building values on the schedule. It effectively makes the statement of values a set of per-location sub-limits.
Quoting and selling notes
- Accurate, current replacement cost values for every building become critical. An undervalued building can be badly underinsured even with a large blanket limit.
- Negotiate the highest margin percentage available, and update values at every renewal and after improvements.
