Shopping for insurance can sometimes feel overwhelming. Contracts, coverages, and premiums vary from one insurer to another.

Among the options available, two policies come up frequently: all-risk insurance (also known as comprehensive coverage) and named perils insurance.

What is the difference between the two? What is included in an all-risk policy? Most importantly, which protection best fits your situation?

Here is what you need to know to make an informed choice.

What is All-Risk Insurance?

As the name suggests, all-risk insurance covers virtually everything, except for a few general exclusions. It is not limited to a specific list of included risks.

Note: Certain situations may still be excluded or require an endorsement (additional coverage). This is often the case for water damage, overland flooding, and other specific risks.

What is Named Perils Insurance?

Unlike all-risk coverage, named perils insurance only covers the risks explicitly listed in your home insurance policy.

If an event is not specifically mentioned in your contract, the resulting damage may not be covered.

For this reason, a named perils policy is often considered a basic option, whereas an all-risk policy generally provides broader protection.

Can you insure your dwelling and personal belongings differently?

Yes. The coverage selected for your building and your personal property can differ.

For example, some insurers may cover your dwelling on an all-risk basis while protecting your contents under a named perils option.

When comparing insurance options, always check the specific coverages for both your home and your personal belongings.

What Does All-Risk Insurance Cover?

An all-risk policy can cover a wide variety of unexpected events, depending on your contract’s terms. Because every insurer is different, a risk covered under an all-risk policy with one company might be treated differently by another.

Examples of situations that may be covered include:

A skunk enters your home and causes damage
A bear damages your home’s exterior siding
Your luggage vanishes while traveling
Your hearing aids are lost or damaged
You accidentally drop and break your dentures
A death by suicide occurs in your residence or rented property
A delivery company drops a heavy piece of furniture, damaging your hardwood staircase

The exact coverage always depends on your specific policy. A given event may be covered, limited, or excluded depending on your contract. Some of these situations might also be covered under a named perils policy, depending on the insurer. In the event of a claim, coverage is determined by your contract’s exact terms.

Be sure to speak with your broker or insurer to understand what your policy actually covers.

What Are the Limits and Exclusions?

Even with an all-risk policy, certain situations are not covered.

Your contract may limit or exclude damage related to:

Normal wear and tear or lack of maintenance
Certain natural events
Specific types of water seepage or water damage
Overland flooding or sewer backup (depending on your chosen options)
Earthquakes
Certain high-value items or situations subject to specific policy limits

Never rely solely on the name of the policy. To know what is genuinely covered, review the exclusions, limits, and endorsements in your contract.

Is All-Risk Insurance More Expensive?

Broader coverage can mean a higher premium than a named perils policy. However, home insurance pricing depends on many factors, such as:

The type and location of your residence
Its value and characteristics
The value of your belongings
The endorsements chosen
Your deductible amount
The insurer selected

It is always best to weigh the scope of coverage against the premium rather than choosing based on price alone.

How to Choose the Right Home Insurance Coverage

In our view, an all-risk policy remains the best overall home insurance option. It covers a broader range of situations, offering stronger protection for your home and belongings.

That said, the right home insurance policy depends on your personal reality, your needs, and your desired level of protection.

At AMR, we are here to guide you. We can help you compare options and find the home insurance tailored to your needs.