What are Special Perils?

Insurance companies define the types of property claims that your policy will cover. There are two ways they can set up the program. Your insurance provider can list out all the different claims they will cover, or they can list out the types of claims they will not cover.

1. If you see “special perils,” the insurance company will list all the excluded causes of loss on your property policy
2. If you see “Basic or Broad perils,” the insurance company will list the claims they will cover.
   You may also see that you have special perils excluding one particular claim type. This may look like “Special – Excluding theft.” Or the company might exclude wind or hail.

If you have a choice, you should take special perils every time.

Realistically, if you see anything other than special perils, you should be asking why you don’t have special perils. It usually indicates that the insurance company believes your property is a higher risk to insure and wants to offer something other than broader coverage.
Here are some reasons why an insurance company may not offer special perils

1. You have a history of claims.
2. They don’t believe you have the proper controls in place. For example, they may want you to install a burglar alarm before offering theft coverage.
3. They may believe you are in a higher-risk territory for specific claims such as windstorms, wildfires, or crime.
4. Your property is vacant.
5. Your property is in disrepair.
6. Your property is under construction.

Whatever the reason, it’s worth questioning. Sometimes coverage is restricted, and if nobody asks about the logic behind the decision, the policy will continue to renew without adding back the coverage.