A coverage limit is the top end of what insurance will pay in the event of a covered loss. You get to decide what number is right from you based on the options provided by the carrier and depending on the amount of product you are seeking.
Most policies contain different types of coverage, each with their own limit. Coverage limits, deductible, and personal factors all influence your premium. But they also influence how much you could be responsible for out of your own pocket if you experience a loss. Always consider both sides of the equation as you choose the option that best suits your needs.