What is a "named perils" policy?

A "named perils" policy is a type of insurance coverage that specifically identifies and lists the perils or risks that are covered under the policy. This means that the insurer will only provide coverage for damages or losses that occur as a result of the named perils stated in the policy documents. For instance, if the policy lists fire, theft, and vandalism as covered perils, then only these events would trigger a claim for coverage. If a damage event occurs due to an unlisted peril, such as an earthquake or flood, no coverage would apply.

This type of policy contrasts with an "all-risk" or "open perils" policy, which generally covers all risks of loss unless specifically excluded. Named perils policies can often be more affordable but may leave policyholders more vulnerable to certain types of losses not covered by the specific perils listed.