What is Dwelling Coverage?

Home owners insurance is the general policy that covers the home itself as well as the property in it. The policy provides financial protection against damage to property and legal responsibility for any injuries to any member of the house. When purchasing any kind of home insurance, one needs to clearly understand what each type of insurance cover entails. The term 'dwelling coverage' can sometimes be perplexing to potential insurance customers. The following information will make the term simpler to comprehend.

Dwelling coverage refers to the portion of home owners insurance policy that helps to pay for either the repair or the entire rebuilding of the structure of a person’s home after damages caused by a hazard covered in the policy. It can also be termed as dwelling insurance. This kind of insurance is almost similar to home owners insurance but the main difference is that dwelling insurance is less comprehensive. It only covers the structural part of a home. This includes the main structure of the house plus any other smaller structures attached to it such as a deck, a garage, a porch etc. Other structures that are not attached to the main house are not covered by the policy. Thus, you might be required to separately add them to the policy so that they can be repaired or rebuilt in case of any damages.

Dwelling insurance can be used by either landlords to cover their rental houses where comprehensive coverage may not be a priority or by home owners to cover the homes they live in.
What Dwelling Insurance Covers

Although the coverage by dwelling insurance may vary from one geographical location to another, the following perils are generally under this type of insurance cover:

  • Fire or smoke
  • Wind damage
  • Lightning
  • Hail
  • Riot
  • Explosion
  • Theft
  • Motor vehicle damage
  • Falling objects
  • Damage from an aircraft
  • Sinkholes

What Dwelling Insurance Does not Cover. Dwelling coverage do not cover against the following risks:

  • Earthquakes
  • Floods
  • Damages caused by the lack of proper maintenance

After understanding the basics of dwelling coverage (especially that it covers for the structure only) one can comfortably say that this type of home insurance is a best fit for owners who are not worried about the property inside the houses, for example, rental houses or leased out homes. It is best for an individual who intends to cover for a structure in which they do not reside or own its contents or property. Nevertheless, dwelling coverage is a crucial component of home owners insurance.

For instance, it is unnecessary to have full coverage for a rental property that you own but do not live in since you do not own the property in it. In such a case, Dwelling insurance becomes a convenient policy to use. This is because the property is still valuable to you as a source of income therefore its safety is paramount. This type of insurance can also be recommended to home owners who are not capable of paying the general home owners insurance but can utilise this dwelling coverage for the main structure of their homes. Therefore, dwelling insurance is an important part of home insurance in various ways.

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