Los Angeles Claims Adjuster Property and Causality Practice Exam

What type of policy provides coverage for all risks of loss except those specifically excluded?

1. Named Peril Form

2. Open Peril Form

3. Basic Cause of Loss Form

4. Broad Form

The correct answer is: Open Peril Form

The policy that provides coverage for all risks of loss except those specifically excluded is known as the Open Peril Form. This type of insurance coverage is comprehensive in nature, meaning it protects against a wide range of potential losses unless there are explicit exclusions outlined in the policy document. This is particularly beneficial for policyholders seeking robust protection, as they have coverage for a myriad of incidents. In contrast to other policy types, such as the Named Peril Form, which only covers losses specifically listed in the policy, the Open Peril Form is more favorable for those wanting broader protection. It allows the insured party to have peace of mind knowing they are covered for unforeseen events, as long as those events are not listed among the explicit exclusions that are typically defined within the policy. This distinction makes the Open Peril Form a preferred choice for many individuals and businesses looking for extensive risk management in their insurance policies.