I've read over my home-owners insurance policy very well. There are no provisions that say anything about "electrical work requiring a city permit shall be done by a licensed electrician".

Do you have any evidence to point to where someone changes a dishwasher or some other small electrical project, and later insurance denies a claim?

I can imagine scenarios of gross negligence (wires run all over exposed, gas leaks, etc. etc.), but if we are talking small mistakes by homeowner during a un-permitted DIY project, I have a very very hard time believing insurance is going to scour the rubble to investigate...like literally how to you prove that!?