The Benefits of Open Perils Home Insurance Coverage

An Open Peril policy gives protection against a wide range of possible causes of damage. Find out if this type of policy is right for you.

The types of home owner insurance options that are available to people can be incredibly confusing. Insurance providers can overwhelm the consumer with the different choices that are available to them, sometimes making it almost impossible for a first-time home owner to decide what the right choice is for them. Too many times, this leads to people who are getting a home insurance online quote to make a poor decision that has major negative consequences down the road - either in paying too much in premiums or not having the right coverage when something serious happens to their home.

When getting a home owner insurance quote, coverage is typically presented in two ways: Named Peril coverage and Open Peril coverage. A Named Peril policy only provides coverage for property damages or loss that occurs because of hazards or events that are specifically named in the policy. For example, with a Named Peril policy a person would not be able to file a claim for damages incurred during an earthquake unless an earthquake was one of the previously named perils specified in the policy.

Open Peril coverage is the exact opposite. It provides coverage for any type of event that causes property loss or damage except for perils that are specifically listed in the plan. To use the previous example, a person who suffers damage to their home in an earthquake who has an Open Peril policy could file a claim for repairs unless their home insurance policy specifically says that earthquake damages are not covered.

Many people choose a Named Peril coverage option because they think of it as cheap home insurance. But the reality is that for many people, adding as many perils as they need in order to have adequate coverage makes it just as expensive as an Open Peril policy, but without the added benefit of being covered against unusual circumstances that would never be included in a Named Peril policy - such as a car driving through a house. Before you decide on a policy, think about if an Open Peril policy is right for you.

Lou Albini is a freelance writer specializing in financial services and insurance. His work has been published in major print and online news sites. He lives in Brooklyn, NY.