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🏠 '''Dwelling policy''' is a [[Definition:Property insurance | property insurance]] product designed to cover residential structures that do not qualify for a standard [[Definition:Homeowners insurance | homeowners insurance]] policy — typically because the property is not owner-occupied as a primary residence. In the United States, where the term is most widely used, dwelling policies are written under standardized forms (commonly the DP-1, DP-2, and DP-3 forms developed by the [[Definition:Insurance Services Office (ISO) | Insurance Services Office]]) and provide coverage for rental properties, seasonal homes, vacation dwellings, and properties that are temporarily vacant or under renovation. Unlike homeowners policies, which bundle property coverage, [[Definition:Personal liability insurance | personal liability protection]], and coverage for the occupant's personal belongings into a single package, dwelling policies focus primarily on the structure itself and may offer limited or no liability or contents coverage unless added by [[Definition:Endorsement | endorsement]].

🔧 The three standard dwelling policy forms offer progressively broader protection. The DP-1 provides [[Definition:Named peril | named-peril]] coverage on an [[Definition:Actual cash value (ACV) | actual cash value]] basis, covering only specifically listed perils such as fire, lightning, and windstorm. The DP-2 expands coverage to a broader set of named perils and settles losses on a [[Definition:Replacement cost | replacement cost]] basis for the dwelling structure. The DP-3 is the most comprehensive, providing [[Definition:Open peril | open-peril]] (all-risk) coverage on the dwelling itself while covering other structures and personal property on a named-peril basis. Landlords insuring rental properties often select a DP-3 and add endorsements for [[Definition:Fair rental value | fair rental value]] loss (covering lost rental income when a covered peril renders the property uninhabitable) and premises liability. Because the [[Definition:Insured | insured]] does not live in the dwelling, the [[Definition:Moral hazard | moral hazard]] profile differs from that of owner-occupied homes — a factor that affects [[Definition:Underwriting | underwriting]] criteria, inspection requirements, and pricing. [[Definition:Vacancy clause | Vacancy provisions]] are particularly important: if a covered dwelling remains unoccupied beyond a specified period (often 60 days), the policy may restrict or suspend coverage for certain perils.

💡 Dwelling policies occupy an essential niche in the residential insurance market. The growth of rental housing, short-term rental platforms, and investment property portfolios has expanded demand for this product, as standard homeowners forms explicitly exclude non-owner-occupied structures. For insurers, dwelling policies represent a distinct risk segment: the absence of an owner-occupant can mean deferred maintenance, slower detection of damage, and different claims patterns compared to primary residences. In catastrophe-exposed regions, dwelling policies on vacation and coastal properties contribute to [[Definition:Aggregation risk | aggregation risk]] that underwriters must manage alongside their homeowners books. While the dwelling policy concept is most formalized in the U.S. market, analogous products exist in other jurisdictions — in the UK, landlord insurance serves a similar function, and in Australia, landlord building insurance covers investment properties with structures tailored to local perils and tenancy law. Regardless of market, the fundamental principle is the same: residential structures that fall outside the standard homeowner paradigm still need purpose-built coverage.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Homeowners insurance]]
* [[Definition:Property insurance]]
* [[Definition:Named peril]]
* [[Definition:Replacement cost]]
* [[Definition:Landlord insurance]]
* [[Definition:Vacancy clause]]
{{Div col end}}

Definition:Dwelling policy - Revision history

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