Open Perils
Open perils coverage (also called "all-risk" or "special form") protects against all causes of loss EXCEPT those specifically excluded in the policy, providing broader protection than named perils.
Exam Tip
Open perils = all risks EXCEPT exclusions. Insurer must prove exclusion. HO-3 dwelling, HO-5 everything.
What are Open Perils?
Open perils coverage (also called "all-risk" or "special form") covers all causes of loss unless specifically excluded. The burden shifts to the insurer to prove an exclusion applies.
How Open Perils Works
Instead of listing what IS covered, open perils policies list what is NOT covered:
| Status | Named Perils | Open Perils |
|---|---|---|
| Fire | Listed = Covered | Not excluded = Covered |
| Flood | Not listed = NOT covered | Excluded = NOT covered |
| Mysterious disappearance | Not listed = NOT covered | Often excluded = NOT covered |
Common Open Perils Exclusions
| Exclusion | Reason |
|---|---|
| Flood | Separate NFIP policy needed |
| Earthquake | Separate endorsement needed |
| War | Uninsurable catastrophic risk |
| Nuclear Hazard | Government coverage (Price-Anderson) |
| Intentional Loss | Can't insure deliberate acts |
| Wear and Tear | Maintenance, not insurance |
| Vermin/Insects | Pest control, not insurance |
| Mold | Often limited or excluded |
Open Perils Policies
| Policy | Open Perils Applies To |
|---|---|
| HO-3 | Dwelling (Cov A) and Other Structures (Cov B) |
| HO-5 | Everything: dwelling AND personal property |
| DP-3 | Dwelling fire policy |
| BPP Special Form | Commercial property |
Burden of Proof
| Coverage Type | Who Proves? |
|---|---|
| Named Perils | Insured proves peril is listed |
| Open Perils | Insurer proves exclusion applies |
Exam Alert
Open perils is BROADER coverage. HO-3 is the most common homeowners policy and uses open perils for the dwelling but named perils for personal property. HO-5 uses open perils for everything.
Study This Term In
Related Terms
Named Perils
InsuranceNamed perils coverage only protects against specific risks explicitly listed in the insurance policy, such as fire, lightning, windstorm, and theft. If a peril is not named, it is not covered.
Homeowners Policy (HO Forms)
InsuranceHomeowners policies are standardized insurance contracts (HO-2, HO-3, HO-5, etc.) that provide property and liability coverage for owner-occupied residences.
Replacement Cost
InsuranceReplacement cost is a property valuation method that pays the full cost to replace damaged property with new items of like kind and quality, without deducting for depreciation.