"But my situation is different." If you've ever looked at a standard insurance policy and said those words, you may need Difference in Conditions (DIC) coverage.
"DIC is a specialty coverage designed for risks not covered by standard policies," says Bernie Neff, an insurance consultant in Cottage Grove, Minnesota
Neff says the use of DIC has been dropping as insurers have developed a broader range of specialty policies. But as the market continues to harden and carriers add more exclusions to policies, Neff expects the use of DIC to increase.
A big advantage of DIC coverage is what's known in insurance jargon as freedom of form and rate, which means there is no standard policy or price. DIC contracts are customized based on the your needs and what the carrier is willing to cover. Typically, you'll pay more for DIC protection than for a standard policy; deductibles are also likely to be higher.
Neff has seen DIC policies used for flood and earthquake, pollution, cargo theft and more. The decision to go with DIC coverage depends on a variety of issues, such as what carriers your agent has access to and the overall state of the market. For example, you may be able to get a standard policy to cover a specific risk; a business in the next state may have the same need but be forced by the market to turn to DIC to get it insured.