The Basic Form Dwelling policy provides coverage for the main structure, but part of the insurance amount may be used to cover other detached structures on the premises and/or loss of fair rental value. Contents coverage is also available for for an additional premium.
A Basic Form Dwelling Policy offers the least coverage and therefore is a good lower cost option for older homes or homes that may otherwise be uninsurable due to their condition. A Basic Form Dwelling policy offers coverage for only specifically named events and may only include fire, lightning and internal explosion. This is very basic, but you can ask to add the following events to the Basic form: smoke, explosion, windstorm, hail, vehicles, aircraft, riot, civil commotion, volcanic eruption, vandalism and malicious mischief.
Usually a Basic Form Dwelling policy offers claim payment on an actual cash value (ACV) basis, which means the cost of replacement minus an amount for age and condition. Depending on the insurer and the condition of the property, some Basic Form Dwelling policies may be changed to provide replacement cost for claim payment, for an additional cost.