Registered Insurance Brokers of Ontario (RIBO) Practice Exam

Question: 1 / 475

What does it mean if a policy is described as "named perils"?

Coverage for all types of risks

Coverage only for specific risks listed

A policy described as "named perils" indicates that it provides coverage only for specific risks that are explicitly listed within the policy documents. This means that if a peril (or risk) is not named in the policy, it is not covered at all. This type of policy is typically more limited in scope compared to an "all risks" policy, which would cover a wider range of potential hazards unless specifically excluded. The named perils approach helps policyholders understand exactly what risks are protected under their insurance plan, making it crucial for them to review these specifics when evaluating their coverage needs.

The correct understanding revolves around the idea that named perils policies are designed to cover only the risks that are stated, ensuring clarity and specificity in what is insured.

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No coverage for contents

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