First a personal comment:
I am not suggesting for a minute that one drives without headlights on. To many studies and statistics conclude that the chance of collision is reduced by increased visability of oneself.

Canadian and European 850 owners may or maynot be aware that American 850s give the owner the choice of having daytime lights or not, via a screw adjustment on the light switch. I too wanted this choice in the event I want to turn my headlights off, with the engine running.

Schematic on pg#50 of Volvo service manual TP 3903202, clearly shows three types of light switches. 1) American, 2) Canadian, 3) European.
the following instructions are based on this information...

Tools needed: small screwdriver, small wire cutters
Total time: 5 minutes

- Carefully pry out the light switch using a small screwdriver, taking care not to scratch the surrounding dash plate.
- Disconnect switch from wire harness, (two clips)
- Put switch aside
- Look for GN-R wire, (green/red) leading into pin #5 of harness.
- Cut wire
- Re-connect harness to light switch
- Carefully push light switch back into dash plate.

Results with ignition on:
position #1 - headlights off, dash lights off, parking lights on.
position #2 - headlights off, dash lights on, parking lights on.
position #3 - headlights on, dash lights on, parking lights on.

note* high beams work, all off when ignition off.

Notes* - modification does not effect the "failed bulb" circuitry.

- this modification effects headlights only, not parking lights.

- this modification may void your warranty

- those wishing to modify the parking lights as well, entails modifying the switch itself. (difficult to do) --
Tony G '94 850GLT, '82 240DL