When it comes to protecting your home, having the right insurance coverage is essential. One of the most important components of a homeowners insurance policy is dwelling coverage. But what exactly is dwelling coverage, and why do you need it? Let's break it down.
What Is Dwelling Coverage?
Dwelling coverage, often referred to as Coverage A on your homeowners insurance policy, protects the physical structure of your home. This includes:
- Your house
- Attached garages
- Built-in systems (water heater, furnace, air conditioners, etc).
- Flooring, ceilings, countertops, cabinets, and vanities
- Attached decks, verandas, and screened-in porches
- Chimneys
If your home is damaged or destroyed by a covered event, dwelling coverage is designed to cover the cost to repair or replace the physical structure of the home and it’s built in systems.
Removable window air conditioners and most appliances are considered a part of contents coverage and are not covered under your dwelling protection.
What Does Dwelling Coverage Protect Against?
A standard home insurance policy typically covers a variety of events, which may include:
- Fire and smoke damage
- Storm damage (when applicable)
- Lightning strikes
- Explosions
- Falling objects
- Theft and vandalism
- Damage caused by the weight of snow, sleet, or ice
- Accidental water or steam discharge
- Damage from motor vehicles
It’s important to note that standard policies do not typically cover damage caused by floods, earthquakes, sewer backups, or lack of maintenance. Additional coverage options, such as flood insurance or earthquake insurance, may be necessary depending on your location and risk factors.
Dwelling Coverage vs. Other Structures Coverage
While dwelling coverage applies to your home and its attached structures, it does not extend to detached structures like:
- Detached garages
- Sheds
- Fences
- Guest homes
These structures are generally covered under a separate part of your homeowners insurance called other structures or outbuildings.
How Much Dwelling Coverage Do You Need?
Determining the right amount of dwelling coverage is essential to ensuring you can fully rebuild your home in case of a total loss. Insurance providers consider factors such as:
- Square footage of your home
- Type and age of roof and exterior materials
- Flooring and built-in features
- Number of bathrooms and other structural details
- Local construction and labor costs
The key figure used for determining coverage is called the replacement cost value (RCV). This is different from your home’s market value and is based on what it would cost to rebuild your home from the ground up at today’s prices.
Condo Dwelling Coverage: How It’s Different
If you own a condo, your dwelling coverage works differently. While your condo association's master policy may cover the exterior of the building and shared areas, your personal condo policy covers the interior space, including any upgrades you’ve made to:
- Flooring
- Cabinets
- Countertops
- Built-in appliances
Understanding what your condo association’s insurance covers will help you determine how much individual dwelling coverage you need.
What’s Not Covered by Dwelling Coverage?
While dwelling coverage protects against many perils, there are some exclusions. Common exclusions include:
- Poor home maintenance
- Flood damage
- Earthquake damage
- Sewer or water backups
There are coverage options that cover damage from floods, sewer backups, and earthquakes, they are not typically included in your dwelling coverage.
Get the Right Protection for Your Home
Dwelling coverage is a vital part of any home insurance policy. Ensuring you have the right amount of coverage can give you peace of mind, knowing that your home is protected against unexpected disasters. If you have questions about your dwelling coverage needs, contact an experienced insurance broker today to explore your options.
Want to speak with an insurance expert? Give us a call today! We’re here to help.
