All Risks

Deciphering All Risks Insurance: A Comprehensive Guide

Understanding All Risks Insurance

When it comes to property coverage, insurance providers offer two main types: named perils and all risks. While named perils policies specify the perils covered, all risks insurance provides broader coverage by automatically covering any risk not explicitly excluded from the policy.

Exploring All Risks Coverage:

Comprehensive Protection: All risks insurance offers extensive coverage, protecting policyholders from a wide range of perils unless specifically excluded.
Exclusions and Riders: Common exclusions from all risks policies include earthquakes, war, and government seizure. Policyholders can often add specific coverage for excluded events through riders or floaters.
Burden of Proof: Policyholders must prove physical loss or damage to trigger coverage under an all risks policy, shifting the burden of proof to the insurer to prove any applicable exclusions.

Special Considerations and Caveats

While all risks insurance provides comprehensive coverage, it comes at a higher cost compared to named perils policies. Policyholders should carefully review policy exclusions and consider the likelihood of claims when assessing the value of this type of coverage.

Key Points to Remember:

Price vs. Coverage: The cost of all risks insurance should be weighed against the likelihood of filing a claim and the level of coverage provided.
Policy Customization: It's possible to have both named perils and all risks coverage within the same policy, offering tailored protection for different types of property.
Exclusions Awareness: Despite its name, all risks insurance does not cover every conceivable risk. Policyholders should review exclusions carefully to understand the limitations of their coverage.

Final Thoughts