What does the DP-1 policy primarily cover?

The DP-1 policy, also known as the Dwelling Policy Form 1, is designed to provide coverage for specific risks, known as named perils. This means that it protects the insured property from certain hazards explicitly listed in the policy. Among these named perils are fire, lightning, and internal explosion, which are fundamental to the basic coverage afforded by the DP-1.

This policy is typically utilized for properties like residential dwellings or rental properties that may not require as comprehensive coverage as other types of policies like the DP-2 or DP-3. The focus on named perils means that unless a peril is specifically mentioned in the policy, it is not covered, which contrasts with all-risk policies that cover a broader range of risks.

The other answer choices are misleading in the context of what the DP-1 policy actually covers. While the policy does not extend coverage for all property damage (like flooding, which is often excluded), nor does it provide a blanket "all risks" coverage that is characteristic of more extensive policies. Although vandalism and theft might be covered under certain conditions in other policy forms, they are not primary focus areas in the DP-1. Thus, the clarity of coverage under the named perils approach is essential