What Does a DP1 Insurance Policy Cover?

A DP1 insurance policy provides basic dwelling coverage, primarily for properties not occupied by the owner. It offers protection against specific, limited risks. This policy serves as a foundational option, distinct from more comprehensive homeowner’s policies, focusing on safeguarding the physical structure of the dwelling itself.

The Purpose of a DP1 Policy

A DP1 policy, also known as Dwelling Fire Form 1, operates on a “named peril” basis, covering only losses explicitly listed. This makes it a basic insurance product compared to broader policies. Property owners typically purchase a DP1 policy for rental properties, vacant homes, or properties that do not meet underwriting requirements for more extensive homeowner’s policies. It is a suitable choice when minimal coverage is required.

Landlords often utilize this policy to protect investment properties. Owners of unoccupied or seasonal homes may also opt for a DP1, as these properties present different risk profiles than owner-occupied residences. It does not extend to personal belongings or liability in the same way a standard homeowner’s policy would.

Specific Perils Covered by DP1

DP1 policy coverage is narrowly defined, focusing on specific events. The most common peril is fire, including direct damage from flames and resulting smoke. This protection extends to the dwelling structure, covering repair or replacement costs. The policy typically covers accidental fires, whether originating inside or outside the insured structure.

Another standard peril is lightning, specifically direct damage from a lightning strike to the insured property. If lightning directly strikes the house and causes structural damage, the policy responds. It focuses on the physical impact of a lightning bolt rather than power surges or other indirect effects.

An internal explosion is also a standard covered peril under a DP1 policy. This refers to an explosion originating within the insured structure, such as one caused by a malfunctioning furnace or water heater. It does not typically cover explosions caused by external events or intentional acts. These three perils—fire, lightning, and internal explosion—form the core coverage of a standard DP1 policy. Additional perils are only covered if specifically added through endorsements.

Understanding Standard Exclusions

Because a DP1 policy is a basic named peril form, it excludes many common risks typically covered by more comprehensive policies. Damage from windstorms and hail is generally not covered. Similarly, various forms of water damage, such as from burst pipes, leaks, or flooding, are typically excluded.

Vandalism and malicious mischief are standard exclusions. Theft of property, whether from the dwelling or premises, is another common exclusion under a DP1 policy. Damage from falling objects, such as trees or debris, and damage due to the weight of ice, snow, or sleet are also not included.

A DP1 policy does not typically include personal liability coverage, which protects the owner from claims arising from injuries sustained by others on the property. Some excluded perils, such as windstorm, hail, vandalism, or malicious mischief, can often be added through specific endorsements for an additional premium. However, certain perils like flood or earthquake damage usually require separate, specialized policies.