An all risk insurance policy offers one the coverage and protection from all risks or perils that could damage your home or contents and personal property unless the risks are excluded specifically in the policy wording. This is different from a standard household insurance policy because a household insurance policy only offers you coverage for named perils on contents. An all risk insurance policy that covers all risks on both home and personal property is also referred as open perils.
Having coverage for All-Risks means if you need to make a claim due to sudden or accidental damage, you would be covered on an all-risk policy unless the insurance company proves the damage is the result of something that is specifically excluded or limited in the wording.
Alternatives to all-risk policies include named perils policies, which cover only those risks specifically listed on the policy, or a combination policy that provides all-risk coverage on your home but coverage only for named perils on your belongings.1
Typical Exclusions in All-Risk Policies
Every insurance company may choose to include more coverage on their All-Risk policy by limiting exclusions as a value-added perk. Most policies will exclude the following;-
- Damage caused by rodents or pests
- Some types of water damage including sewer backups
- Earth movement
- Nuclear incidents
- Acts of terrorism
- Breakage of fragile items
- Mechanical breakdown
- Wear and tear
- Hidden or latent defects
- Gradual damage