Homeowner’s insurance is often comprised of several components, making it difficult to keep track of all that’s covered. So you may have stumbled upon dwelling insurance recently in your policy or saw it referred to as “Coverage A.” Dwelling insurance can be confusing, but compared to other coverage types included with homeowners’ insurance, it’s the simplest to clarify and simultaneously one of the most important to be aware of: so what is it?
What is Dwelling Insurance?
Dwelling insurance coverage, or “Coverage A,” is a component of homeowners’ insurance. It refers to structures attached to the main home as well as the home itself. This type of coverage comes with most standard homeowners’ insurance policies. The limits of other components of coverage on a homeowners policy are normally determined as a percentage of the amount of Coverage A.
Dwelling coverage typically refers to the cost of repairs for the walls, floors, roof, windows of a house, and the above attachments, but may also cover built-in objects. It works in tandem with the total cost of repairs, the value of the home (which determines the size of the deductible), and the quality of your homeowner’s insurance to calculate the deductible amount.
How Dwelling Insurance Works
The deductible is the price the policyholder pays before their insurance pays out. It may be a fixed amount or sometimes is calculated based on the home’s insured value. So, for instance, your garage was struck by a vehicle. Under dwelling insurance coverage, you can then file a claim and receive the cost of repairs. Before you do, however, you’ll need to access your policy to understand what your coverage and deductible limits are.
When you purchase homeowners’ insurance, it includes a dwelling coverage limit. If your policy includes other structures' coverage (coverage for structures that aren’t attached to the house, or “Coverage B”), the limit of your dwelling insurance will influence the limit of other structures' coverage. Generally, the more coverage you have for dwelling, the higher the limit of other structures' coverage. By default, this limit is usually 10% of the coverage A limit.
Dwelling insurance coverage is a beneficial addition to homeowners’ insurance. It protects from damage to more than just the home itself, expanding to cover several hazards like possession loss. Becoming familiar with dwelling insurance coverage will help you become more knowledgeable about the benefits you’re provided under your insurance and thus maximize the use of your homeowners’ insurance benefits.