Form DP 01 38: Washington Changes - Dwelling Property
1. What the form is
The DP 01 38 "Washington Changes" endorsement is a mandatory form used in conjunction with standard Dwelling Property (DP) policies in the state of Washington. Its primary purpose is to modify the base Dwelling Property policy (such as DP 00 01, DP 00 02, or DP 00 03) to ensure compliance with specific Washington state laws, regulations, and consumer protection requirements. This endorsement supersedes any conflicting provisions in the standard policy language, tailoring the coverage to meet the unique legal landscape of Washington.
2. Classes of business it applies to
This endorsement applies to any Dwelling Property insurance policy issued in Washington for residential dwellings. This includes, but is not limited to:
- Owner-occupied dwellings: Homes where the insured resides.
- Tenant-occupied dwellings: Properties rented out to others (landlord insurance). For example, a landlord owning a single-family home or a duplex that is rented out would have this endorsement on their dwelling policy.
- Seasonal or secondary homes: Dwellings not occupied by the insured on a year-round basis.
- Dwellings under construction: In some cases, though specific course of construction endorsements might also apply.
It is used with the three standard Dwelling Property forms: DP 00 01 (Basic Form), DP 00 02 (Broad Form), and DP 00 03 (Special Form). The DP 01 38 ensures that whichever of these underlying forms is used, it adheres to Washington's specific requirements.
3. Special considerations
Several important considerations apply when using the DP 01 38:
- Mandatory Use: This form is not optional; it must be attached to all Dwelling Property policies written in Washington to ensure legal and regulatory compliance.
- Superseding Language: Provisions within the DP 01 38 will override any terms in the base policy that are contrary to Washington law. For instance, if Washington law mandates a specific timeframe for notice of cancellation, this endorsement will amend the policy's cancellation clause to reflect that requirement.
- Consumer Protection Focus: Many of the modifications enforced by this endorsement relate to consumer rights, such as regulations regarding policy cancellation, nonrenewal, claims handling procedures, and specific coverage mandates or prohibitions unique to Washington.
- Impact of Washington State Law Changes: The content of the DP 01 38 may be updated periodically to reflect changes in Washington's insurance laws or regulations. Insurers and agents must ensure they are using the most current version of the form.
- Over-insurance: Washington law prohibits over-insurance, meaning a property cannot be insured for an amount exceeding its fair value (replacement cost less depreciation). The DP 01 38 would uphold such state-specific statutes.
- Replacement Cost: Washington law allows insurers to offer replacement cost coverage without deduction for depreciation, subject to rules made by the commissioner. The DP 01 38 would align the policy with these provisions.
Real-world example: If a standard DP 00 01 policy has a provision for a 30-day notice of non-renewal, but Washington state law (as reflected in DP 01 38) requires a 45-day notice (or 60 days effective July 2025), the 45-day (or future 60-day) requirement from the DP 01 38 would apply.
4. Key information for agents and underwriters
- Pricing: While the DP 01 38 itself may not have a direct premium impact, the underlying Washington-specific requirements it incorporates (e.g., broader coverage mandates in certain areas, specific claims handling processes) can indirectly influence the overall base rates for Dwelling Property policies in the state.
- Risk Assessment: Underwriters must be aware of the modifications imposed by the DP 01 38 as they can affect the scope of coverage. For example, if the endorsement modifies how certain perils are covered or alters conditions for coverage, this needs to be factored into the underwriting assessment.
- Coverage Gaps: Agents should understand the changes implemented by this endorsement to accurately explain coverage to clients and identify potential gaps that might need to be addressed with other endorsements or policies. It's crucial to explain what is not covered by a standard dwelling policy even with this endorsement, such as flood or earthquake, which typically require separate policies.
- Underwriting Guidelines: Company underwriting guidelines for Washington will incorporate the requirements mandated by the DP 01 38. This includes adherence to state laws regarding allowable reasons for declination, cancellation, and non-renewal.
- Compliance: Failure to use this endorsement or adhere to its provisions can lead to regulatory penalties, and policy terms being reformed to comply with Washington law in the event of a dispute.
Real-world example for agents: An agent explaining a Dwelling Property policy to a client in Washington should highlight any provisions modified by the DP 01 38, such as specific rules about how long the insurer has to give notice before canceling a policy for reasons other than non-payment of premium, ensuring the client understands their rights under Washington law.