What does DP Coverage D - Fair Rental Value cover?

DP Coverage D - Fair Rental Value is designed to provide financial protection for homeowners who rent out their properties. Specifically, it compensates insured individuals for the loss of rental income when their rental property becomes uninhabitable due to a covered peril, such as fire or water damage. This coverage is applicable when the insured has a residential property that generates rental income.

Choosing the option that states loss of rental income if the insured is renting space directly aligns with the purpose of this coverage. It acknowledges that if a rental unit becomes unavailable due to a covered loss, the owner can claim the lost rental income for that period.

In contrast, the other choices do not accurately reflect the scope of Coverage D. Loss of rental income from a vacant property does not qualify, as this coverage typically applies to rental properties that are actively occupied or rented out. Owner-occupied rental properties only misinterprets the coverage, as it doesn't limit itself solely to properties that are occupied by the owner, but rather to any rental scenario affected by a covered loss. Lastly, rental agreements for commercial properties are outside the remit of DP Coverage D, which is primarily focused on residential rental income loss.