What Is the Difference Between Dwelling Fire Insurance and Homeowners Insurance?

Finding the right insurance is a crucial part of owning property, but it can be tricky to determine which policy best fits your needs. Dwelling fire insurance and homeowners insurance are similar in that they both provide protection for your homes; however they are designed to cover different types of properties.
outside of a home

The professionals at RCU Insurance Services can help you determine which policy is right for you. Contact us today for more information.

Which Type of Property Does a Homeowners Insurance Policy Cover?
Homeowners insurance is generally written to cover your primary residence from damage due to perils such as fire, theft or vandalism. Your primary residence is where you live for the majority of the year and where most of your possessions are located. Homeowners policies may protect these possessions, your home and any surrounding structures.

A homeowners policy typically includes personal liability insurance. This coverage may provide protection if you are legally responsible for others’ property damage or bodily injury. Elements of homeowners insurance, such as coverage limits, may also be customized for your needs. Other coverages including debris removal, water backup and identify theft may be available.

Which Type of Property Does a Dwelling Fire Insurance Policy Cover?
Dwelling fire insurance has similarities to homeowners insurance, but it also has key differences. Like homeowners insurance, it may provide protection if a fire or other covered event damages a home or its attached structures (e.g., deck or garage). However, dwelling fire insurance covers houses that are not your primary residence, and its policies typically do not provide liability coverage. Examples of properties that might could benefit from dwelling fire insurance include secondary residences, investment properties, vacation homes or vacant homes.

Dwelling fire insurance has different levels of coverage to choose from, including:

DP-1: Basic Form—The basic form typically provides coverage for named perils such as fire, lightning and internal explosion. Claims are generally settled on an actual cash value (ACV) basis.

DP-2: Broad Form—The broad form generally offers coverage for more named perils than a basic form policy and usually settles claims on a replacement cost value (RCV) basis. In addition to the perils covered by the basic form, the broad form may cover damage from events such as vandalism, burglary, falling objects, freezing or collapse.
DP-3: Special Form—The special form provides the broadest protection for your dwelling. It is an open perils policy that covers all types of damage except those that are specifically excluded, and claims are generally settled on an RCV basis. Typical exclusions include war, neglect, repeated water leakage, mold, rust and rot.

Contact Us Today
The above information is not all-inclusive. Your RCU Insurance Services agent can provide additional details on coverage, limits, exclusions and costs. Contact us today for more information or a quote.