Which dwelling policy insures a structure on an actual cash value basis?

The dwelling policy that insures a structure on an actual cash value basis is commonly the DP-1. This policy type primarily provides basic coverage for property damage and is generally considered a standard form of insurance. Actual cash value (ACV) is defined as the replacement cost of the property minus depreciation, reflecting the current value of the property if it were to be replaced or repaired.

The DP-1 policy typically covers specific named perils, such as fire, lightning, and explosion, and the payout for claims is calculated based on this ACV basis, which means policyholders may receive less than what it would cost to replace the asset completely. This often results in lower premiums compared to other dwelling policies that provide broader coverage.

Other policy types, like DP-2 and DP-3, generally offer replacement cost coverage for damages to the property, meaning they would provide a payout without deducting depreciation. The DP-6 is generally not referenced in a standard collection of dwelling policies, and its recognition might vary, but it primarily relates to a mobile home policy under certain contexts. Thus, the DP-1 is specifically structured to reflect actual cash value coverage, aligning perfectly with the question's requirement.