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Named Perils Policy: What Is Covered?

A named perils insurance policy is a type of home insurance policy where you are covered only for the losses specifically listed in your policy. For most standard home insurance policies, named perils coverage applies only to your personal property, while your home's structure has broader protection under open perils coverage.

Keep reading to learn how a named perils policy works and how it compares to an open perils policy.

What Is a Named Perils Policy?

A named perils policy is a home insurance policy that covers only the losses specifically listed in your policy. Any cause for losses not listed in your policy would not be covered by your insurance company. You can find more information about what's covered and what's not in the declarations page in your policy.

Below are the 16 named perils that are commonly referenced in a named perils policy:

  • Explosion

  • Riot or civil commotion

  • Damage by aircraft

  • Damage by vehicles

  • Smoke

  • Sudden/accidental tearing, cracking, burning, or bulging of home systems

  • Vandalism or malicious mischief

  • Volcanic eruption

  • Weight of ice, sleet, snow

  • Freezing of home systems

  • Sudden/accidental power surges

  • Water/steam discharge from home systems and appliances

Named perils policy example

Let's say your named perils coverage only lists fire damage as a covered loss but not falling objects. A fire burning down your home would be a covered claim, but a tree branch falling on your roof would not.

What Does a Named Perils Policy Cover?

A named perils home insurance policy commonly references two different types of coverage: dwelling and personal property. Dwelling coverage refers to the actual structure you live in, while personal property coverage includes your home's contents (e.g., clothes and furniture). Your coverage will depend on the type of homeowners insurance policy you choose.

A named peril policy covers only the perils specifically listed in your home policy.

Here is a summary of what the different types of named perils policies cover. Note that HO-5 is an open peril policy and is not listed below but would cover all of the listed perils unless excluded in the policy.


HO-1 (dwelling and personal property)

HO-2 (dwelling and personal property)

HO-3 (personal property only)

HO-8 (dwelling and personal property)

Fire or lightning

Windstorm or hail

Explosion

Riots

Aircraft

Vehicle

Smoke

Vandalism

Theft

Volcanic eruptions

Falling objects



Weight of ice, sleet, snow



Water/steam discharge from home systems and appliances



Sudden/accidental tearing, cracking, burning, or bulging of home systems



Freezing of home systems



Sudden/accidental power surges



HO-1 and HO-8 policies offer the most limited coverage, protecting your dwelling from only 10 out of 16 named perils. An HO-2 policy provides additional coverage, protecting you from all 16 named perils. Most carriers do not sell HO-1 and HO-2 policies.

An HO-3 policy is considered standard home insurance and is sold by virtually all home insurance companies. An HO-3 policy has named perils coverage on personal property only. Dwelling is covered under an open perils policy (more on that next). An HO-5 policy offers more comprehensive coverage, protecting your dwelling and personal property from all perils except those excluded in your policy.

Protect Your Home and Your Personal Belongings

Open Perils Policy vs. Named Perils Policy

A named peril policy provides coverage for the perils listed in your policy and ONLY those perils. For example, say your named peril home insurance policy covers you only against fires and windstorms. You would have coverage for wildfires and a strong gust of wind but not for damages from falling objects and hail.

An open-peril policy (also called all an risk policy) will cover all perils EXCEPT those that insurers specifically exclude in the policy. Specific perils commonly excluded in open-peril policies are damages from an earthquake, flood, nuclear hazard, and mold.

Which Policy Is Right For Me?

Most homeowners will have a mixture of named perils and open perils coverage. HO-3 policies, the most commonly purchased home insurance policy according to the National Association of Insurance Commissioners, provides you with open perils coverage on your dwelling and named perils coverage on your personal property.

HO-1 and HO-8 policies offer the most limited coverage, protecting your dwelling from only 10 out of 16 named perils.

Here is a summary of the available types of home insurance policies and their respective coverages:

Policy

Description

Dwelling

Personal Property

HO-1

Most limited coverage

Covers 10 named perils

Not covered

HO-2

More coverage than HO-1, less than HO-3

Covers all 16 named perils

Covers all 16 named perils

HO-3

Basic policy used by most homeowners

Open peril

Covers all 16 named perils

HO-5

Highest coverage level

Open peril

Open peril

HO-8

Limited coverage for older and historic homes.

Covers 10 named perils

Covers 10 named perils

HO-5 insurance is ideal if you want open perils coverage on both dwelling and personal property.

While rarely sold, HO-1 and HO-2 policies may be ideal if you're comfortable paying less for less extremely limited coverage.

If you own an older home, then you may only qualify for an HO-8 policy.

Named Peril Policy FAQs

What are the 16 named perils?

The 16 named perils are fire or lightning; windstorm or hail; explosion; riots; damage from aircraft; damage from vehicles; smoke; vandalism; theft; falling objects; weight of ice, snow or sleet; overflow of water or steam; sudden warping of home systems; freezing of warp systems; sudden and accidental damage from power surges and volcanic eruptions.

What does covered peril mean?

A covered peril refers to a peril that your insurance company will cover if you suffer damages or losses from that event. For example, if fire is a covered peril, then your insurance company will approve a claim and reimburse you for your loss if your home burns down from a wildfire.

What is the difference between a named perils policy and an open perils policy?

A named peril policy covers only the perils specifically listed in your home policy — if only fire damage is listed, then you will only be covered against fire damage. An open perils policy will cover all perils except those specifically excluded in your policy — if only earthquake damage is excluded, you are covered for all perils except earthquake damage.

A covered peril refers to a peril that your insurance company will cover if you suffer damages or losses from that event.

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