It depends on your comfort level and how much coverage you have.  If you have a policy of $250,000 or maybe even $500,000 you might want the additional assurance of having the claims expenses outside the policy limits.  On the other hand, if you have $1,000,000 of coverage, you may be OK with the claims expenses inside the policy limits.  It would have to be quite a monster claim to eat up $1,000,000 to pay the claim and legal expenses.

You should also consider what kind of work you do.  If you do a lot of commercial work, where the purchase prices and loan amounts are closer to the $1,000,000 range, you may want the claims expenses outside the policy limits.  Or, if you are in a part of the country where homes can be close to that figure, you may also want to go that route.

I have $1,000,000 and feel quite comfortable having my claims expenses inside the policy limits.

Best,
Robert A. Franco
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