Georgia Property & Casualty Practice Exam

Under which coverage part of her homeowners policy is lumber bought for construction insured?

1. Coverage A - Dwelling

2. Coverage B - Other Structures

3. Coverage D - Loss of Use

4. The lumber isn't insured by her policy.

The correct answer is: Coverage A - Dwelling

Lumber purchased for construction is insured under Coverage A - Dwelling of a homeowners policy. This coverage is designed to protect the physical structure of the home itself, which encompasses not only the built components, such as the walls and roof, but also materials that are intended for use in the construction, repair, or renovation of the home. Since lumber is a fundamental building material, it falls within the scope of Coverage A. In contrast, Coverage B pertains to structures that are separate from the dwelling, such as a shed or a detached garage. Coverage D specifically addresses loss of use, which provides financial assistance when the insured property becomes uninhabitable due to a covered peril, rather than directly covering materials or construction materials. The assertion that the lumber isn't insured by the policy is incorrect because, in fact, any lumber intended for use in building or repairing the home would be protected under Coverage A, provided that the construction itself is permissible and follows any applicable regulations.