What is a Dp-1 home insurance policy?

A DP-1 policy, also known as a Dwelling Fire Form 1, is a type of home insurance policy that covers a dwelling against nine listed perils, the most serious being fire. Because a DP-1 policy offers fairly basic coverage, it’s most often used to cover empty houses; however, you can also use it to insure your rental properties.

What is the difference between DP1 and DP3 insurance?

DP1 and DP3 policies are both predominantly used to protect investment properties. The key differences between these policies are the types of coverage offered, the number of perils covered, and how they settle claims. For starters, the DP3 is described as having more robust coverage than a DP1 because the DP3 is an open perils policy.

Does DP1 insurance cover damages?

The insurance will not reimburse you if your house incurs damages from a peril not stated in the DP1 policy. Another aspect that distinguishes the DP1 policy from the others is that it only pays the actual cash value (ACV) during a claim. That means it factors in the property's depreciation.