What are named perils in an insurance policy?

Named perils in an insurance policy refer to specific risks or hazards that are explicitly listed within the policy documentation. This means that the coverage is limited to only those risks that are stated. For instance, if a homeowner’s policy specifies "fire, theft, and vandalism" as named perils, then the insurance will only cover losses directly arising from those specific events. If an event occurs that is not among the named perils, the policyholder would not be entitled to compensation for that loss.

In contrast, general risks or undefined risks might lead to broader coverage interpretations, but named peril policies focus solely on the listed risks. This specificity defines the scope of coverage and can help both insurers and insureds understand their respective responsibilities and exposures. Potential future claims are not relevant to the immediate definition of named perils since they concern events that have not yet occurred.