Most Canadian homeowners think of their home insurance policy as covering the house itself, but a detached garage, a garden shed, or a backyard gazebo usually falls under a different part of the same policy. Understanding how are detached structures like garages and sheds covered on a home policy matters because the default limit for these buildings is often smaller than homeowners expect, and it applies to every outbuilding on the property combined.
This article looks at how detached structures coverage typically works, what counts as a detached structure, what sits outside this part of a policy, and when it may be worth asking a broker to review the limit.
What Is Detached Structures Coverage?
Detached structures coverage is the part of a home insurance policy that applies to permanent buildings on the property that are not physically attached to the main house. It is commonly listed on a policy as Coverage B, or sometimes labelled "other structures" or "detached private structures," and it sits alongside the dwelling coverage that applies to the house itself.
A detached garage, a storage shed, a gazebo, a greenhouse, and a freestanding workshop are all typical examples. The coverage is generally designed to help pay for a covered loss to the structure, such as damage from a fire or a windstorm, subject to the same policy wording, exclusions, and deductible that apply to the rest of the home.
How Much Coverage Does a Standard Policy Include for Detached Structures?
Detached structures coverage is usually set as a percentage of the dwelling limit rather than as its own fixed dollar amount. According to Ratehub.ca, many home insurance policies in Canada default to 10 percent of the dwelling coverage for detached structures, though some insurers set the figure closer to 15 percent, and it can vary by company and by policy.
That means a home insured for $400,000 might come with somewhere between $40,000 and $60,000 in default detached structures coverage, and that amount typically has to stretch across every qualifying building on the property, not just one. A property with a detached garage and a shed shares a single combined limit unless a broker has arranged something different.
| Dwelling coverage | Typical 10% limit | Typical 15% limit |
|---|---|---|
| $300,000 | $30,000 | $45,000 |
| $400,000 | $40,000 | $60,000 |
| $500,000 | $50,000 | $75,000 |
This table shows what a policy is generally designed to provide at common default percentages; only the wording of an actual policy determines the limit that applies to a specific property.
What Counts as a Detached Structure, and What Sits Outside This Coverage?
Detached structures generally means anything permanently installed on the property that stands apart from the main dwelling. Beyond a garage or shed, this can include a fence, a deck not attached to the house, a gazebo, a pool house, or an in-ground pool's surrounding structure, depending on how the insurer defines the term.
A few things typically sit outside this part of the coverage:
- Contents stored inside the structure. Tools, lawn equipment, or furniture kept in a garage or shed are usually covered under the personal property section of the policy, not the detached structures section.
- Business use of the structure. A shed or garage used for a home-based business, such as inventory storage or a workshop for paid work, often needs a separate home-business endorsement, since standard detached structures coverage is generally built around personal, non-commercial use.
- Undisclosed structures. A shed or garage the insurer does not know about can complicate how a related claim gets reviewed, which is part of why disclosing every structure on the property matters at application and at renewal.
Coverage details vary by insurer and by policy wording, so a specific structure's status is best confirmed directly with a broker rather than assumed from general information like this article.
Why the Default Limit Can Fall Short for a Larger Outbuilding
A basic garden shed rarely costs more to rebuild than a policy's default detached structures limit allows. A finished double garage, a workshop with electrical service, or a pool house with plumbing is a different story, since rebuild costs for those structures can climb well past what 10 or 15 percent of a dwelling limit provides.
When a homeowner's outbuildings are worth more than the default share allows, a broker can typically arrange a higher detached structures limit through an endorsement, similar to how an inflation guard endorsement can be added to keep the main dwelling limit aligned with rebuild costs over time. Reviewing this figure periodically is especially useful after a major renovation, a new build on the property, or a jump in local construction costs.
Benefits of Detached Structures Coverage
Having a defined detached structures limit means a homeowner is not relying on the main dwelling coverage to stretch across every building on the property. It gives a clearer picture, in dollar terms, of what a policy is generally designed to provide toward rebuilding a garage, shed, or similar structure after a covered loss.
Because the limit is disclosed on the policy declarations page, it also gives homeowners a concrete number to compare against real rebuild estimates, rather than guessing. That comparison is what makes it possible to catch a shortfall before a loss happens rather than after.
Where You'll Come Across Detached Structures Coverage
This part of a policy tends to come up at a few predictable points. Buying a property with an existing garage, shed, or other outbuilding is one, since the structure needs to be disclosed as part of setting up the policy. Building a new garage, workshop, or garden suite is another, as the added structure can push the total value of outbuildings past the existing limit.
It also surfaces at renewal, when a broker may flag that a property's outbuildings have grown in number or value since the policy was first written, and after a storm or other event that damages an outbuilding, when the declared limit becomes the number that matters most. Reviewing detached structures coverage alongside home insurance at these moments helps keep the figure realistic rather than outdated.
Talk to a Licensed Broker About Your Outbuildings
A garage, shed, or other detached structure is easy to overlook until rebuild costs or a claim make its coverage limit matter. A licensed broker can walk through what is currently declared on a policy, compare it against what the structures on a property would actually cost to rebuild, and outline options for adjusting the limit. Start a home insurance quote to have that conversation.
Coverage details vary by insurer and by policy, and only the wording of an actual policy and a licensed broker can confirm what applies to a specific situation.