What is a common coverage limit threshold for Coverage B in dwelling policies?

In dwelling policies, Coverage B typically provides insurance for other structures on the property, such as detached garages, sheds, and fences. A common coverage limit threshold for Coverage B is often set at 10% of the limit of Coverage A, which insures the primary dwelling itself.

Choosing 20% of Coverage A as the limit for Coverage B goes beyond the standard threshold. Coverage B's typical percentage is intended to offer adequate protection for these additional structures while keeping it proportional to the value of the primary dwelling.

Understanding these limits is important for policyholders to ensure they have sufficient coverage for all properties while adhering to standard insurance practices. Opting for a coverage limit that exceeds the norm could lead to unnecessary premium costs without a corresponding increase in value at risk. This illustrates the importance of recognizing industry standards when selecting coverage options in dwelling policies.