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Open perils

Opens perils coverage refers to a type of property insurance that covers damage to your possessions from all causes except those your policy specifically excludes. It's sometimes referred to as all-risk coverage.

What is open perils coverage?

Open perils coverage is a form of commercial property insurance that provides protection against nearly every type of loss except those specifically excluded in the policy.

Open perils property insurance is different from named perils insurance, which only provides coverage for losses specifically listed in the policy. For example, a named perils policy might only cover damage from these perils or hazards:

  • Fire
  • Theft
  • Vandalism
  • Wind

Open perils coverage is also sometimes called all-perils insurance or all-risk coverage.

What are some common exclusions listed in an open perils policy?

Some common exclusions in open perils policies include:

  • Floods
  • Mudslides
  • Seepage and sewer backups
  • Power failures
  • Rust and corrosion
  • Mechanical breakdowns
  • Earthquakes
  • Boiler explosions
  • Employee theft
  • Fungus damage
  • Animal or insect pests
  • Air or water pollution
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Which type of property insurance is better: open perils or named perils?

Generally speaking, named perils policies are less expensive since they provide less extensive protection. However, if you’re confident the named perils (or hazards) will cover your major risks, then choosing a named perils policy may well be a wise choice.

If your business is more exposed to risk, and if you’re not sure of all the potential losses you might face, buying a more expensive open perils policy might be a better decision, even though it costs more.

A licensed Insureon agent can discuss options with you after you complete a free application to compare commercial property insurance quotes.

You’re responsible for providing proof with named perils policies

With open perils coverage, it’s up to your insurance company to prove that your loss was due to an excluded cause. If it can’t, it must pay for your claim.

However, with named perils policies, it’s up to you to prove that your loss resulted from one of its listed causes. If you can’t, you will have to pay for the damage yourself.

If you don’t want the burden of proof to fall on you, an open perils policy may be the easier option.

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Insureon helps you compare small business insurance quotes with one easy online application. Start an application today to protect yourself against the high costs of business property damage.

Updated: April 29, 2022
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