Definition Peril: Peril is an insurance term for an event that could cause damage to property, items, or belongings insured. Examples of different perils in home insurance are fire, hail damage, flooding, earthquake, and theft, etc. Home Insurance policies are typically divided into ‘All Peril’ and ‘Named Perils’ insurance policies. These may have different costs and cover different risks.
- All perils insurance policies will typically cover most risks, unless they are explicitly excluded in the text of a policy.
- Named perils insurance policies would cover only the risks named in the policy.
In some cases policy holders do not need particular perils, such as earthquake peril in Saskatchewan, Ontario or Manitoba, and thus it makes sense to exclude these and reduce insurance premiums. It is important to know that even All Peril policies would have some events that are not covered such as nuclear disaster or acts of war.
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