All Risk Insurance Claims
There’s a good reason all-risk insurance coverage — which is also known as "all peril" or "open peril insurance" — can be so difficult to understand. The truth is that the phrase "all risk" is actually somewhat misleading, because even with a very good all risk (or open peril) policy, you’re still not covered from all risks. Not even close. (Welcome to the insurance business!)
How Does All Risk or Open Peril Insurance Work?
Here’s how all risk insurance — a form of property insurance — works in practice: Unlike most policies, which will name the specific risks you’re being insured against (flood insurance, for instance, or earthquake insurance), an all risk or open peril policy will only list the excluded risks. (That is, the risks it won’t cover.)
Just as an example, an all risk policy listing earthquakes and floods will cover every possible type of risk, with the exception of damage caused by earthquakes and floods. And so "open peril" insurance, you might say, stands in direct contrast to "basic" or "named peril" policies that tell you exactly what sort of property damage they will cover.
If a specific risk isn’t excluded from an open peril policy, it generally will be covered. These risks can include anything from unintentional liquid spills and rain coming through an open window to a hot appliance burning a countertop, or any other number of accidental household mishaps.
What Forms of Damage Are Most Often Excluded from All Risk Polices?
As we mentioned above, all risk insurance certainly doesn’t protect you from all risks. Some of the most common exclusions found in open peril policies include any damage to your property that happens as a result of earthquakes, floods, or acts of terrorism, or war.
For reasons that should be fairly obvious, open peril insurance is one of the more costly forms of coverage available in the insurance marketplace today. As well it should be, since it covers such an incredibly wide range of potential property damage. And yet there’s one more upside to paying all that money for an open peril policy, which is this:
With a named peril policy, it’s the insured who holds the responsibility of proving that the damage in question was indeed caused by the peril they’ve protected themselves again. That can be tough, especially since insurance providers spend a lot of money on clever adjusters whose jobs involve not giving out payments on policies. But in the case of an open peril policy, the burden is on the insurance company to prove that the loss a property owner has suffered is excluded from their policy.
In practice, flood damage and damage from war are not covered by this type of insurance. However, many other common household damage situations are. If you have suffered any type of damage that is not named under an insurance category on our website, you may be covered under open peril insurance.
Contact Interstate Public Adjusters today: We can help you determine your covered assets in Pennsylvania or New Jersey.
