20+ years in insurance and personal finance content creation
Contributor to top brands like USA Today
John specializes in insurance, personal finance, real estate, and health and wellness. In 2022, he authored a guide on content marketing for beginners.
5+ years in insurance and personal finance content
Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.
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If you’re worried your traditional homeowners insurance doesn’t provide you enough coverage, difference in conditions (DIC) coverage can help. Difference in conditions coverage provides protection beyond what a typical homeowners insurance policy offers, including support for floods, earthquakes, landslides, and mudslides.
Companies often purchase DIC policies to fill gaps in coverage, but homeowners can buy this type of coverage, too.
Difference in conditions insurance explained
DIC policies can help protect homeowners — especially those in areas with a high risk for natural disasters — against perils like earthquakes, floods, and mudslides. Standard home insurance policies don’t usually cover damages from these perils.
Business and commercial property owners commonly use DIC insurance to fill coverage gaps in their master insurance policies.[1]
Traditional home insurers and specialty insurers sell DIC coverage. You can also shop for DIC coverage through an independent insurance agent or broker. DIC coverage may be sold as a separate policy or as an add-on (endorsement) to an existing policy.
But DIC coverage normally comes with separate coverage limits and a separate deductible.[2] In addition, DIC coverage might bump up the overall cost of protecting your home and belongings.
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What DIC insurance covers
DIC insurance covers incidents that a standard homeowners insurance policy doesn’t. This coverage generally includes:
Floods
Earthquakes
Landslides
Mudslides
You can typically customize your DIC coverage. For example, you may be able to purchase either named-perils or all-perils coverage as well.
Named-perils coverage pays claims only for perils that are listed in the policy. All-perils coverage pays claims for any peril that isn’t listed in the policy. Named-perils coverage usually costs less than all-perils coverage.
Good to Know
With DIC coverage, you can tailor your policy to common perils in your region. You may consider DIC coverage if you live in an area prone to both floods and mudslides or both earthquakes and landslides.
What DIC insurance doesn’t cover
DIC insurance typically doesn’t cover perils that a standard home insurance policy covers. Most standard home insurance policies cover the following types of perils, so a DIC insurance policy wouldn’t cover them:
Fire
Smoke
Lightning
Windstorm
Hailstorm
Falling objects
Weight of snow, ice, or sleet
Theft
Vandalism
Damage caused by vehicles
Damage caused by aircraft
Who needs DIC insurance?
The decision to buy DIC insurance depends largely on which catastrophes are common where you live.
For example, if you live in the state of Washington, DIC coverage might be a good investment because landslides and mudslides are common and standard home insurance policies generally don’t cover these disasters.
And if you live in tornado-prone Oklahoma, you might consider skipping DIC coverage because a standard homeowners insurance policy generally covers tornado damage. But since Oklahoma isn’t known as a flood- or earthquake-prone state, DIC coverage might cost more money than it’s worth.
DIC insurance cost
The cost of DIC insurance depends on several factors, including where your home is and the materials used to build it. This means DIC coverage may be more expensive for you if your home is near a cliff where a landslide could occur, for example.
You can reduce the cost of your homeowners insurance, including DIC coverage, by following these tips:
Improve the disaster-readiness of your home by reinforcing your roof, windows, and other key areas.
Ask about discounts, such as those for installing home security equipment.
Raise your deductible. Increasing the deductible from $500 to $1,000 might reduce your premium.
DIC insurance pros and cons
Like most financial or insurance products, DIC insurance has both advantages and disadvantages, including:
Pros
Fills in coverage gaps: DIC policies cover incidents that standard home insurance policies typically don’t cover.
Customizable coverage: You can customize your policy to include either named perils or excluded perils.
Widely available: You can buy a DIC policy through many insurance companies, brokers, and independent insurance agents.
Cons
Separate deductibles: Your DIC policy will probably come with separate coverage limits and deductibles from those included in your standard home insurance policy.
May not be worth the expense: If you don’t live in an area at risk for natural disasters, you likely don’t need this additional coverage.
Where to get DIC insurance
You can buy DIC insurance directly from a variety of traditional and specialty insurers, as well as through independent insurance agents or brokers. Unlike flood insurance, federal programs don’t sell DIC insurance.
A number of well-known insurers sell DIC coverage, including:
CSAA
Compare personalized, real-time quotes
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
NR
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
644
$300,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $300,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$122/mo
$500,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $500,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$192/mo
Farmers
Compare personalized, real-time quotes
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
8.4/10
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
609
$300,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $300,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$180/mo
$500,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $500,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$296/mo
Farmers is the fifth-largest provider of home insurance in the U.S. by market share, according to the National Association of Insurance Commissioners. Founded in 1928 to provide American farmers with affordable car insurance, Farmers now insures homes, other vehicle types, pets, businesses, and more. Farmers offers a discount for bundling home or auto insurance with another policy type. Additionally Farmers offers some noteworthy discounts, such as a discount for smoking-free households, and savings for certain professions. While Farmers has an A rating from AM Best, it has low customer satisfaction scores from J.D. Power and an average rating from the NAIC.
Pros
Offers extended and guaranteed replacement cost options
Notable number of home insurance discounts available
Large nationwide network of Farmers agents
Cons
Not all discounts available in every state
Foremost
Compare personalized, real-time quotes
IQ Score
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
5.2/10
A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
A
$300,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $300,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$199/mo
$500,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $500,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
8.4/10
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
641
$300,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $300,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$223/mo
$500,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $500,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$339/mo
In business for more than 90 years, Nationwide is one of the nation’s largest insurance companies. Nationwide provides a wide range of insurance products, including homeowners, renters, condo, life, umbrella, motorcycle, RV, pet, and auto insurance. The insurer offers discounts for property and car insurance bundling, smart home technology, renovations to plumbing, heating, cooling, and electrical systems, and more. AM Best rates Nationwide A+ for financial stability, and the insurer has a lower-than-average number of homeowner complaints in the National Association of Insurance Commissioner’s (NAIC) Consumer Complaints Index.
Pros
Multiple discounts for homeowners and renters insurance
Intuitive online account management tools
Enhanced coverage through Nationwide Private Client, including temporary arrangements, service line, and equipment breakdown insurance
Cons
Doesn't provide homeowners coverage in Alaska, Hawaii, New Mexico, Louisiana, Florida, New Jersey, or Massachusetts
Doesn't cover mobile or manufactured homes
Slightly lower than average rating in J.D. Power's Overall Customer Satisfaction Index for homeowners insurance
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
8.2/10
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
643
$300,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $300,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$226/mo
$500,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $500,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$317/mo
Founded in 1929, State Farm is the largest home insurance provider in the U.S., based on market share, according to the National Association of Insurance Commissioners. State Farm also sells auto, renters, condo, and life insurance. By bundling home coverage with another State Farm policy, homeowners can save more than $1,000 a year, the company says. With an AM Best rating of A for financial strength, the company has fewer than average consumer complaints in the NAIC complaint index. State Farm also has a customer satisfaction rating of 880 (out of 1,000) from J.D. Power.
Pros
Discount for bundling home coverage with another State Farm policy, like auto
Strong customer satisfaction ratings
Large nation-wide network of State Farm agents
Cons
Comparatively few discounts available for home insurance
No longer sells new homeowners insurance policies in California
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
NR
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
Not rated
A.M. Best
A.M. Best analyzes an insurer’s financials, operating performance, business profile, and other factors to generate an opinion-based rating of a company’s financial and credit strength. Ratings range from A++ (exceptional) to D (poor).
A-
Rooted in more than 20 years of experience in the insurance industry, Stillwater offers home, auto, renters, condo, landlord, umbrella, and business insurance. Optional add ons include animal liability, extended replacement cost, and more. Policyholders can save with discounts for a home built by an accredited builder, having an automatic sprinkler system, having multiple policies with Stillwater, and more. Currently, Stillwater has an A- from AM Best for financial stability, but its rating is currently under review. The company has a lower-than-average number of complaints in the National Association of Insurance Commissioners’ complaint index.
The Insurify Quality (IQ) Score uses more than 15 criteria to objectively rate insurance companies on a one-to-ten scale. The Insurify editorial team researches insurer data to determine the final scores.
7.8/10
JD Power
J.D. Power data measures overall customer satisfaction and claims satisfaction based on a 1,000-point scale.
609
$300,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $300,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$167/mo
$500,000 Dwelling
A standard HO-3 home insurance policy typically includes dwelling, personal property, and liability coverage. The average rate displayed here reflects a policy with the following coverage limits: $500,000 dwelling; $25,000 personal property; $300,000 personal liability; $30,000 loss of use; and a $1,000 deductible for medical payments to others.
$261/mo
Representing nearly 5% of the home insurance market, Travelers Group is the sixth-largest homeowners insurance company by market size, according to the National Association of Insurance Commissioners. Travelers offers home insurance, flood, auto, renters, umbrella, travel, and more types of insurance. The company offers a handful of discounts for homeowners, including ones for bundling, being claims-free, and having a certified green home. Travelers has an A++ rating (the highest available) from AM Best, but a below-average customer satisfaction rating from J.D. Power. The insurer also has a slightly higher-than-average number of customer complaints in the NAIC Consumer Complaints Index.
Pros
Discount available for having a certified green home
Highly customizable with riders such as personal property coverage, and additional replacement cost coverage
Claims filing available through Travelers app or online
Cons
Fewer discounts compared to other home insurers
Conflicting customer service ratings may indicate uneven customer service
Rates tend to be higher than other competitors
You can contact your state’s department of insurance to learn more about DIC providers available to you.
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DIC insurance and California FAIR Plan
Some California homeowners who obtain coverage through the California FAIR Plan may want to consider adding DIC coverage.
Labeled as a last-resort option, the California FAIR Plan makes insurance available to Californians who can’t buy traditional home insurance.[3] But a FAIR Plan provides only basic fire, smoke, lightning, and “internal explosion” coverage by default. Windstorm, hailstorm, and vandalism coverage are available through the FAIR Plan at an extra cost.
A FAIR Plan policy doesn’t cover things like theft, floods, earthquakes, water damage, and personal liability, though. Nonetheless, a FAIR Plan policy meets a mortgage lender’s requirements for home insurance.
Coupling a DIC policy with a FAIR Plan policy provides more comprehensive coverage than a FAIR Plan policy alone would, closely mirroring what a standard policy would cover. For example, if a California homeowner lives in a crime-prone area, a DIC policy could provide theft protection if a burglary occurs.
A FAIR Plan policy doesn’t cover earthquakes, but earthquake coverage is available as a separate policy. The same is true for floods. But a California homeowner can buy flood coverage through the National Flood Insurance Program (NFIP) or from private insurers.
Difference in conditions insurance FAQs
DIC insurance features various wrinkles that you need to know about, and you can find additional information about this type of insurance below.
What’s the difference between HO-3 and DIC policies?
An HO-3, or special form, policy is the most common type of standard home insurance policy. It’s an open-peril policy that covers the structure of your home, your personal belongings, liability if someone is injured on your property, and additional living expenses if you have to move out of your home temporarily while repairs are being made.
DIC policies fill in gaps to cover things that HO-3 policies don’t, such as earthquakes, floods, and mudslides. They typically have separate deductibles and higher coverage limits than standard home insurance policies.
Does a DIC policy have a deductible?
A DIC policy does come with a deductible. So, if you have a $1,000 deductible, the insurer would subtract that amount from a claim payout. A DIC deductible might be higher than the deductible for a standard homeowners insurance policy.
What perils do DIC policies cover?
A DIC policy covers a range of perils, such as floods, earthquakes, landslides, and mudslides. Standard homeowners insurance normally doesn’t include the disasters that a DIC policy covers. A DIC policy can cover perils that are listed in the policy or exclude perils that aren’t listed in the policy.
What is a DIC endorsement?
A DIC endorsement adds coverage to an existing policy. In the case of homeowners insurance, a DIC endorsement would cover perils beyond what a standard policy would cover. This added coverage might increase the overall cost of your homeowners insurance.
Methodology
Insurify data scientists analyzed rates from more than 180 home insurance companies sourced directly from Insurify’s partner companies and Quadrant Information Services. Rates span all 50 states and Washington, D.C., and quote averages represent the mean price for a given coverage level and geographic area. To ensure data reliability, only insurers meeting minimum quote thresholds were included in the analysis.
Unless otherwise specified, quoted rates reflect the average cost for homeowners with no prior claims and good credit with a home construction year of 1980. The default coverage assumptions include:
Default Coverage Assumptions
Dwelling coverage: $300,000
Deductible: $1,000
Personal property limit: $25,000
Liability limit: $300,000
Additional data points beyond these default values are sourced from Insurify’s proprietary database. Rates are updated monthly.
John Egan is a freelance writer and content marketing strategist in Austin, Texas. His specialties include personal finance, real estate, and health and wellness. John’s work has been published by outlets such as CreditCard.com, Bankrate, Forbes Advisor, Experian, Capital One, The Balance and U.S. News & World Report. He is the author of The Stripped-Down Guide to Content Marketing.
John has been a contributor at Insurify since October 2022.
5+ years in insurance and personal finance content
Ashley is a seasoned personal finance editor who’s produced a variety of digital content, including insurance, credit cards, mortgages, and consumer lending products.