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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-1">A named perils insurance policy is a home insurance (or business) insurance policy that only provides coverage on losses incurred to your property from hazards or events named on the policy. Named peril coverage may be purchased as a less expensive alternative to a comprehensive coverage or broad policies, which are policies that tend to offer coverage to most perils.</p>
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<h2 class="has-black-color has-text-color has-extra-large-font-size" id="mntl-sc-block_1-0-3">How a Named Perils Insurance Policy Works?</h2>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-4">If a homeowner doesn't live in an earthquake and flooding prone area, they&nbsp;may elect to get a named perils insurance policy and only declare coverage against fire, theft, and hail, while leaving the earthquake and flooding coverage off the policy.</p>
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<h3 class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block-callout-heading_1-0"><strong>KEY TAKEAWAYS</strong></h3>
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<ul class="has-black-color has-text-color has-large-font-size"><li>A named perils insurance policy only provides coverage on losses incurred to your property from events or risks named on the plan.</li><li>Homeowners may purchase a named perils insurance policy and only declare coverage against hazards like theft or fire.</li><li>If a homeowner lives in a flood zone, they may elect to get a named perils insurance policy rather than earthquake coverage.</li><li>Theft, fire, and natural disasters like hail, earthquakes, and flooding are events or hazards that may be declared on a named perils insurance policy.</li><li>When a person purchases an all risks policy, it covers all perils except those expressly excluded from the list.</li></ul>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-8">Keep in mind that all risks policy does not necessarily guarantee your property will be covered against all forms of perils.</p>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-10">It's thus a good idea for homeowners to check their broad coverage policies to make sure they do cover all the perils that they are concerned about. If the broad policy isn't sufficient, homeowners should buy a named peril policy to fill that hole in their coverage.</p>
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<h2 class="has-black-color has-text-color has-extra-large-font-size" id="mntl-sc-block_1-0-12">Named Perils Insurance vs. All Risks Insurance</h2>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-13">Insurance providers generally offer two types of property coverage for homeowners and businesses—named perils and all risks. "All risks" is a type of insurance coverage that automatically covers any risk that the contract does not explicitly omit.</p>
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<p class="has-black-color has-text-color has-large-font-size">For example, if an all-risk homeowner's policy does not expressly exclude hurricane damage, then the house will be covered in the event of a hurricane.</p>
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<p class="has-black-color has-text-color has-large-font-size"><strong>Important:</strong> A named perils policy contains conditions that cover what the insurer thinks are the most likely perils.</p>
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<h3 class="has-black-color has-text-color has-extra-large-font-size" id="mntl-sc-block_1-0-22">All Risks</h3>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-23">By contrast, an all risks policy covers the insured from all perils, except those&nbsp;specifically excluded from the list. Contrary to a named perils contract, an all-risks policy does not name the risks covered, but instead, names the risks&nbsp;not&nbsp;covered. In so doing, any peril not named in the policy is automatically covered.</p>
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<h2 class="has-black-color has-text-color has-extra-large-font-size" id="mntl-sc-block_1-0-25">Special Considerations</h2>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-26">The most common types of perils excluded from all risks include earthquake, war, government seizure or destruction, wear and tear, infestation, pollution, nuclear hazard, market loss, etc.</p>
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<p class="has-black-color has-text-color has-large-font-size" id="mntl-sc-block_1-0-28">An individual or business who requires coverage for any excluded event under all risks may have the option to pay an additional premium, known as a rider or floater, to have the peril included in the contract.</p>
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<p></p>
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<p>To read the full article, <a href="https://www.investopedia.com/terms/n/named_perils.asp">click here</a>.</p>
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