Allrisks

Allrisks is a term used in insurance to describe coverage that protects against a wide range of potential perils or causes of loss. Unlike named perils insurance, which specifically lists the events that are covered, allrisks policies are designed to cover all causes of loss unless they are explicitly excluded. This typically offers a broader scope of protection for the insured.

The exact wording of an allrisks policy is crucial, as it will detail what events are *not* covered. Common exclusions might include acts of war, nuclear contamination, intentional damage, and certain types of natural disasters that may require separate endorsements. For example, while an allrisks property insurance policy might cover damage from fire, theft, vandalism, and even certain types of water damage, it might exclude flood damage unless a specific flood insurance policy is purchased.

The advantage of an allrisks policy is the assumption that coverage exists unless an exclusion applies. This simplifies the claims process in some respects, as the burden is on the insurer to prove that a loss falls under an exclusion, rather than the insured having to prove that the loss was caused by a named peril. However, it is essential for policyholders to carefully review their allrisks policy documents to understand the full extent of coverage and any limitations or exclusions. This type of coverage is often found in property insurance, marine insurance, and business interruption insurance.