Dwelling vs. Home Insurance: Key Differences

Insurance is one of the best ways to protect property investments. For property owners, the main options include home insurance and dwelling insurance. But while both can be useful, they offer different benefits that might make one better suited to the other depending on the circumstances. Here we take a look at the differences between dwelling and home insurance.

The main differences between dwelling insurance and home insurance

Dwelling insurance is better suited to properties that are rented out to tenants. If you own a piece of property and decide to rent it out, you will have to change your existing home insurance policy to dwelling insurance. This ensures that the property remains protected without you paying higher insurance premiums than you have to.

Dwelling insurance only covers the home’s physical structure. In contrast, home insurance covers the structure and the house’s contents, including appliances, furniture, and even clothing.

It is important to distinguish between dwelling and home insurance, particularly when seeking disaster coverage. If the house is damaged in a fire or hurricane, insurers won’t cover the cost of repairing or replacing the home’s contents if the owner only has dwelling insurance. Instead, it will pay only for the repair of the physical structure.

Homeowners’ insurance provides more comprehensive coverage. Although it doesn’t usually cover floods or earthquakes (you will need to get separate insurance for those), it will pay for damage to the home and its contents.

Homeowners’ insurance even covers damage to additional structures such as sheds and detached garages. These policies may include liability coverage in some cases, but you may have to purchase that separately or have it added to your primary insurance policy.

Specific coverages of dwelling insurance and home insurance

Here are the specific coverages of both types of insurance policies:

Physical structures

Dwelling insurance and homeowners’ insurance both cover the main structure and others connected to the house, such as decks and garages. They also cover the home’s electrical, plumbing, and heating systems.

But homeowners’ insurance also protects detached structures such as sheds and detached garages. Furthermore, homeowners’ policies allow the owner to decide which detached features to add to the policy. Consequently, even swimming pools and barns may be covered against loss or damage.


One of the main differences between the two is liability coverage. Most homeowners’ policies pay for damage claims, medical bills, and legal fees if a visitor to the property is injured or if the property is damaged because of the owners’ neglect or omission.

Dwelling insurance doesn’t provide liability coverage unless the property owner purchases a separate liability policy or adds the necessary coverage to the main dwelling insurance policy.

Personal property

“Personal property” refers to the contents of the home. This is covered by most homeowners’ policies but not dwelling insurance. Personal property may include everything from appliances and furniture to clothing and personal effects.

Jewelry, art, and antiques may or may not be covered by home insurance. Regardless, it is a good idea to purchase separate policies for these items, particularly if they are expensive.

Dwelling insurance generally doesn’t cover personal property unless it is specifically added. Adding personal property coverage is advisable if you have dwelling insurance and want to be compensated for lost or damaged items if a disaster occurs.

Loss of use

“Loss of use” refers to the situation in which the property owner cannot live in the home after it is damaged due to a covered incident. In such cases, home insurance will pay for the temporary living expenses of the property owners and their families. Dwelling insurance usually does not cover these incidents.


“Perils” refers to events or situations that result in loss or damage to the property. While dwelling insurance and home insurance both cover these, they often differ in the perils they cover.

Dwelling insurance usually covers only “named perils” or specific causes of loss or damage, with some exclusions. Homeowners insurance generally offers “all perils” coverage, protecting against all causes except some that are excluded from the policy.


Dwelling and home insurance protect property owners from fires, floods, storms, and extreme weather conditions. Homeowners’ policies also protect against theft, vandalism, and personal property loss. But despite their similarities, each type of insurance is intended for different applications.

If you own a piece of property and decide to rent it out, you must change your home insurance policy to dwelling insurance. But if you continue to live in your home, a dwelling policy won’t provide adequate protection. Knowing the differences between the two will help you determine which insurance policy better suits your needs.

About Snyder Specialty

Snyder Specialty, LLC is a New York-based underwriting facility that provides a range of property and liability solutions for personal and commercial lines. Specializing in coastal properties and hard-to-place risks, Snyder Specialty expands your current capabilities with proven solutions for complex risks. Find out more about the company’s range of services by calling (718) 362-8039.