Reviewed by Stefan Tirschler
Updated September 7, 2022
cov·er·age b | ˈkəv-rij ˈbē
Definition: The section of a home insurance policy that covers, at the insured premises, structures that are not attached to the main building or dwelling.
Clara’s tool shed was included within Coverage B of her homeowners insurance policy.
The Insurance Bureau of Canada, or IBC, has standard homeowner’s forms. These forms are like templates for most home insurance policies offered in Canada. The forms divide insurance coverages into sections—A through G—and many insurance policies keep IBC’s coverage names intact.
Coverage B is for “detached private structures.”
The main building at any insured address (or premises) is usually the house, but it can be any type of building that people live in. The main building (also called a dwelling) on the premises is part of Coverage A, which also includes anything attached to the building. Garages or decks, as long as they’re connected to the house, are part of Coverage A.
Coverage B, on the other hand, is for buildings and other structures that are not physically connected to the dwelling. Hence, “detached.” For a full explanation, visit detached structures.
Coverage B describes which detached structures the policy covers and under what conditions. The reason for separating things into different coverages is to give them different limits of insurance.
Ronald has a gazebo in his backyard. His homeowners insurance policy includes Coverage B with a limit of just $2,500. His Coverage A (for his house and the attached garage) has a limit of $330,000. A severe windstorm damages his gazebo and his house. The gazebo ends up costing $3,000 to repair, while the house needs $10,000 in repairs.
His insurance company covers the full cost of repairing the house, but can only offer him $2,500 for the gazebo repairs. Even though his house repairs are well under the Coverage A limit, the gazebo can’t borrow any of the unused coverage. His gazebo repair coverage is limited to Coverage B’s $2,500.
Not every insurer uses IBC’s naming scheme for coverages. Square One, for example, does not use the name “Coverage B” in our homeowner policy wordings, but we still insure detached structures. We include it within Section 3, as Detached Structures, Fences and Landscaping, which is an optional coverage. Since landscaping isn’t part of the typical Coverage B, we won’t go into that here. We’ve got a dedicated article about insuring fences and landscaping if you’re interested.
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About the expert: Stefan Tirschler
Stefan is responsible for underwriting leadership, market expansion, and product research and development for Square One's operations. Stefan has earned his Fellow Chartered Insurance Professional designation, and maintains a level 2 general insurance license in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. Stefan is also an Education Committee member and CIP/GIE instructor for the Insurance Institute of Canada.
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