Which type of policy covers all perils unless specifically excluded?

Which type of policy covers all perils unless specifically excluded?

• A. Named Perils Policy
• B. Open Perils Policy
• C. Basic Coverage Policy
• D. Special Form Policy

Answer: (B)

The type of policy that covers all perils unless specifically excluded is known as an open perils policy. This means that the policy provides broad protection against a wide range of risks, and the insured is covered for any loss or damage unless the policy specifically lists exclusions. This is advantageous for policyholders because it shifts the burden of proof to the insurer to prove that a particular peril is not covered based on specific exclusions. In contrast, a named perils policy only covers risks that are specifically stated in the policy, meaning that if a peril is not listed, the coverage does not apply. Basic coverage and special form policies may have their definitions, but they typically do not encompass the full range of perils as comprehensively as an open perils policy does.

The type of policy that covers all perils unless specifically excluded is known as an open perils policy. This means that the policy provides broad protection against a wide range of risks, and the insured is covered for any loss or damage unless the policy specifically lists exclusions. This is advantageous for policyholders because it shifts the burden of proof to the insurer to prove that a particular peril is not covered based on specific exclusions.

In contrast, a named perils policy only covers risks that are specifically stated in the policy, meaning that if a peril is not listed, the coverage does not apply. Basic coverage and special form policies may have their definitions, but they typically do not encompass the full range of perils as comprehensively as an open perils policy does.