What is the primary function of Coverage D (Fair Rental Value)?

Coverage D, also known as Fair Rental Value, is specifically designed to address the situation where a rental property becomes uninhabitable due to a covered loss, such as fire or water damage. In such cases, the property owner is entitled to compensation for the rental income they would have earned while the property is undergoing repairs and is not available for tenants to occupy.

This coverage is crucial because it ensures that landlords can maintain their financial stability during the period in which their property is not generating income due to damage, thereby providing a safety net for loss of income related to the property. It's important to note that this coverage does not extend to other types of expenses, such as renovation costs, direct property damage repairs, or coverage for property that is being moved, which are addressed by different sections of an insurance policy.