.0 Dwelling Policy
Learning Objectives
.1 Dwelling Program Eligibility
Properties insured under the Dwelling Program may be occupied by either the owner or tenants. To qualify, the property must be used primarily for residential purposes and may contain no more than four dwelling units. It may also house up to five roomers or boarders. Certain incidental business activities may be permitted when the property remains principally residential and the business does not involve retail sales. Examples include professional offices, instructional studios, beauty shops, and schools.
.2 Dwelling Coverages
The Dwelling Program includes three policy forms, each offering a different level of property coverage:
.3 Dwelling Coverage Forms
Although the Basic Form (DP–1), Broad Form (DP–2), and Special Form (DP–3) provide the same general categories of coverage, each form applies that coverage differently. The primary distinctions are the perils covered and the method used to determine the amount payable for a covered property loss.
.4 Other Coverages
Dwelling policies include an Other Coverages section rather than an Additional Coverages section. The protections listed in this section are automatically included in the policy without requiring the insured to pay an additional premium.
.5 General Exclusions
The Dwelling policy forms exclude losses caused directly or indirectly by the following perils. These exclusions apply even when another cause or event contributes to the loss at the same time or in any sequence.
.6 Conditions
Dwelling policies include several conditions that are commonly found in property insurance policies, including the following:
.7 Selected Endorsements
Automatic Increase in Insurance Endorsement
Recap of Chapter Five
1. The Dwelling Program provides property insurance for residential dwellings that may not qualify for a standard Homeowners policy because of factors such as age, value, condition, or location. An eligible dwelling may contain up to four residential units and may house no more than five roomers or boarders. Limited incidental business activities may be permitted when the property remains primarily residential. Examples include a professional office or a studio used to provide music lessons. Mobile homes that meet specific requirements, such as being permanently attached to a foundation, may qualify for coverage under the Basic Form (DP–1). Farm dwellings are not eligible for coverage under the Dwelling Program and require a policy designed for agricultural exposures.