What Is Coverage A (Dwelling Coverage) in Insurance?

Homeowners insurance policies are structured into various coverage types, often labeled with letters such as A, B, C, and D. These distinct categories address different aspects of property protection. Among these, Coverage A holds a primary position, specifically addressing the physical structure of the home. This article explains Coverage A and its role.

Defining Coverage A

Coverage A, known as Dwelling Coverage, protects the main physical structure of your house. It extends to components permanently attached or built into the home, such as the roof, walls, and foundation. It also includes structures physically connected to the main house. For instance, an attached garage, deck, or screened-in porch falls under this coverage.

This protection applies against various “perils,” specific causes of loss outlined in the policy. These include damages from fire, smoke, lightning strikes, windstorms, hail, and vandalism.

What Structures Coverage A Protects

Dwelling Coverage covers the physical structure of your home, encompassing its interior and exterior walls, roof, and foundation. It includes integral components permanently installed within it, such as built-in appliances like furnaces and hot water heaters, plumbing and electrical wiring, heating and cooling systems, and fixed interior elements like flooring, countertops, and cabinetry. Attached garages, carports, and decks are protected under this policy.

Common Items Not Covered by Coverage A

While Dwelling Coverage is extensive, it does not cover every type of property or cause of damage. Structures that are not physically attached to the main dwelling are excluded from Coverage A. These include detached garages, sheds, fences, and swimming pools, which are covered under Coverage B, often referred to as “Other Structures” coverage.

Additionally, personal belongings within the home, such as furniture, clothing, and electronics, are not protected by Coverage A; these fall under Coverage C, known as “Personal Property” coverage. Standard Coverage A policies also exclude certain perils, such as damage from floods, earthquakes, mold, and general wear and tear. For protection against these risks, homeowners need to purchase separate policies or add endorsements to their existing coverage.

How Coverage A Limits Are Determined

The Coverage A limit represents the maximum amount your insurance company will pay to rebuild or repair your dwelling and any attached structures after a covered loss. This limit is primarily based on the estimated replacement cost of your home, which is the amount it would take to reconstruct the property from the ground up using similar materials and quality at current prices. It is important to distinguish replacement cost from the home’s market value or purchase price, as market value includes land value and is influenced by real estate market fluctuations, which are not relevant to rebuilding costs. Factors influencing this replacement cost estimate include the home’s square footage, the cost of local construction labor and materials, the architectural style, and specific features like custom cabinetry or high-end finishes. Insurers often use specialized tools or estimators to calculate this amount, and it is important for homeowners to ensure their Coverage A limit is adequate to fully rebuild their home in the event of a total loss.