What does a "Difference in Conditions" (DIC) provision cover?

A "Difference in Conditions" (DIC) provision specifically addresses the gaps in coverage that may arise from local insurance policies. This type of provision is designed to provide coverage for certain perils or risks that are not covered by the underlying or local policies. For example, if a local policy excludes certain catastrophic events like earthquakes or floods, the DIC provision can fill that gap, offering coverage for those specific excluded risks.

The importance of the DIC provision lies in its ability to supplement existing insurance by providing a broader range of protection, particularly for businesses or individuals who wish to mitigate risks that local policies do not address. This is why it is correctly associated with providing coverage for perils not covered under local policies.