Which coverage is automatically provided for single-family dwellings insured at 80% of replacement value?

Replacement cost coverage is automatically provided for single-family dwellings insured at 80% of their replacement value because this coverage ensures that, in the event of a loss, the homeowner can receive compensation that reflects the current cost to replace the property without deducting for depreciation. By insuring the home at 80% of its replacement value, the insurer is effectively stating that in the case of a total loss, they will cover the cost of replacing the damaged or destroyed property with new materials of like kind and quality, thereby providing a significant advantage to the policyholder.

In contrast, actual cash value coverage factors in depreciation, meaning the payout after a loss would be less than the cost to fully replace the home. Accidental damage coverage is not generally included automatically and typically requires additional endorsements or separate policies. Liability coverage, while important, serves a different purpose by protecting against claims for property damage or bodily injury to others and is not related to covering physical damage to the property itself.