Dwelling coverage
Dwelling coverage is the part of your homeowners insurance policy that protects the structure of your home. It’s also called Coverage A and is one of the most important parts of your home insurance policy. If your house is damaged or destroyed by a covered event, dwelling coverage helps pay to repair or rebuild it up to the limits listed in your policy.
Many people think of home insurance as protecting their belongings or helping in emergencies. While those are important, the foundation of your home insurance protection starts with the dwelling itself. That’s where dwelling coverage comes in.
What does dwelling coverage include?
Dwelling coverage helps pay to repair or rebuild the main structure of your home if it's damaged by a covered peril. It typically covers:
- The physical structure, including foundation, walls and roof
- Attached structures like a garage, deck, or porch
- Built-in appliances such as your furnace, water heater, or central air system
- Key systems, including plumbing, electrical and HVAC
Your dwelling coverage applies when the damage is caused by risks listed in your policy. These risks are also known as covered perils. Common covered perils include:
- Fire and smoke
- Windstorms and hail
- Lightning strikes
- Vandalism and theft
- Falling objects
- Weight of snow or ice
- Sudden and accidental water damage
- Damage from floods or earthquakes (these usually require separate policies)
- General wear and tear or neglect
- Detached structures like fences, sheds, or guest houses (these are often covered under a different part of your policy)
If you're asking, “Does dwelling coverage cover detached structures?” the answer is no — you’ll want to check your policy's Coverage B or outbuildings section for that.
How much dwelling coverage do I need?
Knowing how to calculate dwelling coverage limits can help you avoid being underinsured. The key number to focus on is your home's replacement cost, meaning, how much it would cost to rebuild the home from the ground up using similar materials and current construction prices.
This number is different from your home’s market value or what you originally paid. Market value includes the land, location and resale value, but dwelling coverage only applies to the rebuild of the structure itself.
Factors that go into determining your dwelling coverage limit include:
- Square footage
- Local labor and construction costs
- Type of materials (brick, wood, siding, etc.)
- Home layout and design
- Unique features like fireplaces, vaulted ceilings, or custom flooring
Your insurance company or advisor may use a rebuild cost calculator to estimate the amount of dwelling coverage you need. You can also hire a contractor or appraiser for a second opinion if you're unsure.
Replacement cost vs. actual cash value
Your home insurance policy may cover your dwelling based on either replacement cost or actual cash value and it’s important to know the difference.
- Replacement cost pays the full cost to rebuild your home using similar materials, without subtracting for depreciation. This gives you more complete protection.
- Actual cash value subtracts depreciation, which means your payout could be less than the full cost of repairs or rebuilding.
Most policies offer replacement cost by default, but it’s worth confirming. If your policy only offers actual cash value, you may want to consider upgrading to make sure your home is fully covered.
What is extended or guaranteed replacement cost?
Because construction prices can go up, especially after major storms or natural disasters, many insurance carriers offer optional add-ons that boost your dwelling limit when needed:
- Extended replacement cost adds a percentage (often 10–25%) to your existing dwelling limit in case building costs rise unexpectedly.
- Guaranteed replacement cost pays to fully rebuild your home, no matter how much the prices increase, even if they go over your dwelling limit.
These features can provide peace of mind, especially if you live in an area with rising construction costs or strict building code upgrades.
Understanding Coverage A in home insurance policies
Coverage A refers to dwelling coverage in your homeowners insurance policy. It is the core coverage that applies to your home’s physical structure. Other coverages in your policy, like Coverage B for detached structures or Coverage C for personal property, build on top of this foundational protection.
Understanding Coverage A helps clarify how much protection you have, what’s included and where additional endorsements or add-ons might be needed. If you’ve made renovations or added square footage to your home, it’s a good time to review your dwelling coverage limits under Coverage A.
What is not covered under dwelling coverage?
While dwelling coverage protects you from many risks, it doesn’t cover everything. Some common exclusions include:
- Flood damage
- Earthquake damage
- Damage due to neglect, pests, or mold
- Sewer backups (unless you add special coverage)
To cover these risks, you may need separate policies or policy endorsements. If you’re wondering, “What does dwelling coverage include in homeowners insurance?” or “What doesn’t it include?” The best answer is that it covers most structural risks caused by sudden, accidental events, but not gradual wear, maintenance issues, or natural disasters without separate policies.
Difference between dwelling coverage and personal property coverage
Dwelling coverage protects the structure of your home, while personal property coverage (often listed as Coverage C in your policy) protects the things inside your home, like furniture, clothing, electronics and appliances.
Think of it this way:
- If a fire damages your kitchen walls, dwelling coverage applies.
- If that same fire ruins your dining table or microwave, personal property coverage would help.
Knowing the difference between these two helps you make sure you have enough coverage for both the structure and the contents of your home.
How to keep your dwelling coverage up to date
It’s important to review your homeowners insurance policy each year, especially after:
- Home improvements or renovations
- Changes in local construction or labor costs
- New building codes in your area
Your carrier may also offer inflation protection, which automatically adjusts your dwelling coverage to keep up with rising costs. Talk to your insurance advisor to see if this is included in your home insurance policy.
Final thoughts
Dwelling coverage is one of the most important parts of your homeowners insurance policy. It helps you rebuild or repair your home after a covered event, protecting not just your house, but your peace of mind.
By understanding how Coverage A works, what’s included, what’s excluded and how to calculate your coverage needs, you can feel confident that your policy is working for you.
At VIU by HUB, we’re here to make insurance easier to understand and more tailored to your life. If you have questions about your dwelling coverage, or want to check if your limits are still a good fit, we’re here to help — with advice that’s clear, honest and easy to act on.