What is the purpose of Coverage D in a homeowners policy?

Coverage D in a homeowners policy, often referred to as "Loss of Use," is designed to provide financial assistance when a homeowner is temporarily unable to live in their home due to a covered peril, such as fire or natural disaster. This coverage helps pay for additional living expenses incurred while the home is being repaired or rebuilt. For example, if a family has to stay in a hotel while their home is undergoing repairs, Coverage D would reimburse them for those extra costs that exceed their normal living expenses.

This coverage can include expenses for accommodations, meals, and other necessary living expenses that are incurred as a result of the loss. It’s essential for homeowners to have this protection in place as it shields them from the financial strain that can arise during the restoration period, ensuring they can maintain a standard of living even when their home is uninhabitable.