What Is Dwelling Insurance? How Does It Protect Your Home?
Dwelling insurance will help pay to repair or rebuild your home if it's damaged by an event that's covered by your insurance, like a fire or hail.
Dwelling coverage protects the structure of your home — including your foundation, walls, roof and windows — along with any built-in appliances and attached structures, like a garage or porch.
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What is dwelling coverage?
Dwelling coverage, also known as Coverage A, is the part of your homeowners policy that covers repairing or rebuilding your home after it's damaged by something that's covered by your insurance, like a falling tree branch or bursting frozen pipes.
Your dwelling is the building you live in. As far as your home insurance policy is concerned, the definition of a dwelling includes all structures attached to your home (like a garage or deck) as well as built-in appliances (like a furnace or water heater).
Part of your dwelling
- Walls
- Roof
- Foundation
- Plumbing & electrical
- Built-in fixtures & appliances
- Attached garage
Not part of your dwelling
- Land
- Fence
- Detached garage
- Gardening shed
- Pool
Dwelling coverage is only one of the six coverage types included in a standard home insurance policy.
Homeowners insurance coverage types
- Coverage A: Dwelling: Protects your home's structure.
- Coverage B: Other structures: Covers detached structures, like a fence or pool.
- Coverage C: Personal property: Protects your personal belongings, like furniture and clothing.
- Coverage D: Loss of use: Helps pay extra living expenses if your home is damaged and you need to live somewhere else during repairs.
- Coverage E: Personal liability: Protects you against a lawsuit if you accidentally hurt someone or damage their property.
- Coverage F: Medical payments: Covers your guests' medical bills if they're hurt while visiting your home.
If you own a condo, parts of your home are shared with other owners in your building, like the roof and exterior walls. Condo insurance doesn't usually include coverage for other structures either. You'll need to check your condo association's master insurance policy to determine which parts of the building are your responsibility to protect and which parts fall under the master policy.
You should share this information with your insurance company to make sure your policy fully protects your condo.
What does dwelling insurance cover?
Most homeowners insurance policies protect your dwelling against damage from the following:
- Burst pipes
- Car accidents
- Explosions
- Falling objects, including aircraft
- Fire, smoke and lightning
Dwelling coverage can vary based on your insurance company and where you live. You should check your policy documents to understand what you're protected against.
What's not covered by dwelling insurance?
Most dwelling insurance policies don't protect your home from flooding, earthquakes or sinkholes.
In addition, standard dwelling insurance doesn't typically cover:
- Construction defects
- Foundation damage due to settling
- Homes under construction
- Infestation
- Sewer backup
- Vacant homes
- Wear and tear
However, many insurance companies give homeowners the option to add protection against some of these events.
In addition, your dwelling insurance will have a coverage limit and deductible.
Coverage limit
Your coverage limit is the amount of dwelling coverage you choose when you buy your policy. This number should be based on the cost to rebuild your home.
Deductible
Your deductible is the amount you'll have to pay toward repairs before your insurance coverage starts to pay.
For example, if your chimney flue was closed and caused $1,500 of smoke damage in your house, but your policy has a $1,000 deductible, you'll receive only $500 from your insurance provider.
Other structures
Detached garages, sheds or other such structures are not considered part of your dwelling under a traditional homeowners policy. Instead, they're usually protected by your policy's other structures coverage, also known as Coverage B.
Those structures won't typically be covered by a condo policy since you probably aren't the sole owner of that property.
How much dwelling coverage do I need?
You should choose a dwelling coverage amount based on the amount it would cost to rebuild your home and its attached structures if they were totally destroyed.
This amount is not the same as the price you paid for the home or its current market value. The replacement cost of your home will depend on a number of factors, which include:
- The cost of construction and labor in your area
- The square footage of your home
- The style of house (such as a ranch or colonial home)
- Any custom-built features
- The materials used to build your home (like carpet or wood flooring)
Your insurance company will ask you lots of questions about your home when you get a quote, which will help determine how much dwelling coverage you need.
A professional appraiser can give you the most accurate estimate of your home's replacement cost, but you'll have to pay for their services. This might be worth the effort if you feel the insurance company's estimate is too high or too low.
Extra coverage options
Most major homeowners insurance companies give homeowners the ability to add extra coverage to their dwelling insurance. This extra protection is called an endorsement, rider or floater.
You might want to consider this if your home is at risk of being damaged by something that's not typically covered.
Common dwelling insurance endorsements
- Earthquake coverage
- Flood insurance
- Inflation guard
- Sinkhole coverage
- Water backup coverage
How much does dwelling coverage cost?
Dwelling insurance accounts for 95% to 97% of your total insurance cost.
It is the most expensive part of your homeowners insurance policy.
Annual cost of dwelling insurance by coverage amount
Dwelling amount | Cost of dwelling coverage | Total cost |
|---|---|---|
| $150,000 | $1,995 | $2,094 |
| $250,000 | $2,962 | $3,077 |
| $350,000 | $3,990 | $4,120 |
| $450,000 | $4,932 | $5,078 |
Frequently asked questions
What does dwelling coverage cover?
Dwelling insurance covers your home's structure, including your foundation, walls, roof and all of the permanent fixtures inside of your home. It also protects any attached structures, like an attached garage or deck.
How much dwelling insurance do I need?
Homeowners should choose a dwelling insurance limit that would cover the cost of fully rebuilding their home in a major disaster. You can figure out your home's replacement value using your insurance company's software, but hiring a professional appraiser will get you the most accurate estimate.
How important is dwelling coverage?
Dwelling coverage is very important because it will help pay to repair or rebuild your home if it's damaged in a covered event, like a fire or windstorm. If you have a mortgage on your home, your lender will usually require you to have a minimum amount of dwelling coverage. Even if your home is paid off, dwelling coverage can help you avoid expensive repairs if your home has major damage.
What coverage is excluded by a dwelling policy?
Home insurance policies typically exclude earthquakes, flooding and sinkholes. Your home insurance company generally won't pay for repairs due to general wear and tear. There are a number of other types of damage that are usually excluded from your dwelling coverage like damage while your home is under construction or vacant.
What does dwelling mean?
Your dwelling is the house or apartment where you live. In terms of insurance, your dwelling includes the structure of your home — like the floor, walls and windows — along with any attached structures, like a garage.
Methodology
To find the cost of dwelling insurance, we gathered quotes from seven insurance companies across all ZIP codes in the state of Texas. Quotes are for a 45-year-old married man with a good credit score who owns a home built in 1977.
ValuePenguin's analysis used insurance rate data from Quadrant Information Services. These rates were publicly sourced from insurer filings and should be used for comparative purposes only — your own quotes may be different.
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