Which statement best describes blanket coverage?

Blanket coverage is defined as a type of insurance policy that provides coverage for multiple properties or types of risks under a single policy limit. This approach allows for more flexibility and can be more cost-effective than insuring each property or risk separately.

For example, if an individual owns several buildings, instead of obtaining a separate insurance policy for each building, they can opt for a blanket coverage policy that insures all of them under one umbrella. This means that coverage is available for all the properties without having to manage multiple individual policies, and it simplifies the claims process should a loss occur.

The other options focus on specific characteristics that do not encompass the overall nature of blanket coverage. For instance, covering properties based on size or only the highest valued properties doesn’t capture the essence of what blanket coverage provides, which is the ability to insure multiple properties comprehensively. Similarly, covering properties with limited liability does not accurately reflect the broader functionality of blanket coverage, which does not inherently impose such limitations.