What is Dwelling Coverage? Dwelling Coverage[dwel-ing / kuhv-er-ij]noun1.Dwelling Coverage is the portion of a Homeowner’s Insurance Policy that covers the physical structure of the insured home. It is the portion of the Policy that may help rebuild the structure of a home if it is damaged. Share | Have A Question About This Topic? Name Email Address Message Thank you! Oops! Related Content The Best of Both Worlds Here are a few reasons we’ve chosen to be independent. Did You Know This Fact About Basement Flooding? A simple precaution can help prevent basement flooding. Assess Your Life Insurance Needs This calculator estimates how much life insurance you would need to meet your family's needs if you were to die prematurely.