What defines a named peril in an insurance policy?

A named peril in an insurance policy refers specifically to coverage for risks or causes of loss that are explicitly listed within the policy. This means that if a peril is not included in the list, it is not covered under that policy. For instance, a policy might list perils such as fire, theft, or vandalism, and only these particular events would be covered if they occur.

This concept is essential for policyholders to understand because it defines the scope of protection they have. When insuring property or liability, knowing which perils are named enables the insured to assess their risk and determine whether they need additional coverage for unlisted risks.

Coverage that applies to all types of loss, regardless of the cause, defines an "open peril" or "all-risk" policy, which is different from named peril coverage. State regulations could influence various aspects of insurance but do not define named peril coverage specifically. The exclusion of natural disasters may occur in certain policies, but it does not define the concept of named perils in insurance.