MONDAY, DECEMBER 28, 2020
The Difference Between Dwelling & Other Structures Insurance
When you buy a home, you aren’t just buying the house itself. Instead, you are buying both the house and the plot of property on which it sits. Therefore, when you buy homeowners insurance, your plan should offer coverage not only for the house, but also for any of the other buildings or construction on the property. However, within the plan, coverage for the dwelling will be separate for other structures on the property, and each piece of coverage will work in unique ways.
Let’s take a look at both dwelling and other structures coverage, and consider the things to remember when setting up your coverage.
Dwelling Insurance & Its Benefits
Dwelling coverage is the primary insurance benefit for your house itself. It will cover the structure of the home in case of numerous types of damage like fires, vandalism and most types of severe weather. Therefore, if something were to damage the house, you will have this coverage to help you pay for the necessary repairs.
Your policy will generally pay for damage to the house and most attached fixtures, including attached decks. However, certain outdoor fixtures will not have coverage, depending on the way the policy is written. You should ask your agent to clarify these points at the time you enroll in your coverage.
Generally, your dwelling coverage will pay based on the home’s replacement cost value, minus any deductible. If your home is completely destroyed, then replacement cost coverage will help you pay to rebuild the property closely to the way it was before the damage occurred. Your deductible is a value that you agree to pay for these losses yourself, rather than letting your insurance pay.
Other Structures Coverage
Where other structures coverage differs from dwelling insurance is that is applies only to buildings on your property that are not attached to your home. It is separate from your dwelling insurance entirely. These might be things like:
On one hand, your other structures coverage will provide the same replacement cost coverage as your dwelling insurance. However, the total limit of this coverage will likely be based on a percentage of your dwelling coverage and will have a separate deductible. For example, if you have $150,000 worth of dwelling coverage, then your other structures coverage might be 10% of that, or $15,000. However, if you want increased coverage on this benefit, then you can ask for it as a policy endorsement.
Our agents are committed to helping you determine precisely how to structure your dwelling coverage so that you never have to feel concerned that you don’t have optimized benefits at all times.
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