Property and valuation
Open perils
Open perils coverage insures direct physical loss from any cause except those the policy excludes, shifting the analytical focus from the list of covered causes to the list of exclusions.
Reviewed September 2026 · Exam outline effective September 1, 2026
In plain English
An open-perils form inverts the named-perils structure. Rather than asking whether the cause appears on a list of covered perils, the analysis asks whether the cause appears on the list of exclusions.
The burden generally shifts as well. Because the grant is broad, the insurer is usually the party establishing that an exclusion removes the loss, which is why exclusion wording is read so carefully on these forms.
Why the exam tests it
The exam wants candidates to recognize the form type and then run the correct analysis, because the same fact pattern can resolve differently on named-perils and open-perils wording.
The trap
Treating open perils as unlimited coverage. Exclusions and conditions still apply in full, and the phrase all risk does not mean every loss is paid.
Worked example
A special form policy covers direct physical loss unless excluded. Sudden accidental damage from an unusual cause not addressed in the exclusions would generally fall inside the grant, while a wear-and-tear loss remains excluded.
Full course
Study this with the complete Texas All-Lines course
This concept is covered in depth in the "Causes of Loss, Exclusions & Concurrent Causes" lesson, alongside every other topic on the content outline.
Related terms
- Named perilsNamed perils coverage insures only the causes of loss specifically listed in the policy, placing the burden on the insured to show the loss came from a listed peril.
- ExclusionAn exclusion is policy language that removes a cause of loss, type of property, or category of liability from coverage that the insuring agreement would otherwise have granted.
- PerilA peril is the cause of a loss, such as fire, windstorm, hail, theft, or collision.
- Insuring agreementThe insuring agreement is the part of the policy where the insurer states what it promises to pay for, creating the grant of coverage that every later exclusion and condition narrows.
Compared side by side
- Named Perils vs. Open PerilsNamed perils and open perils describe two opposite drafting strategies for defining what a property policy covers. The practical consequence is who has to prove what, which makes this one of the highest-yield distinctions on the property portion of the exam.
- Proximate Cause vs. Concurrent CausationLosses rarely arrive with a single tidy cause. Proximate cause and concurrent causation are the tools for deciding which cause controls when several are present.
Exam topics using this term
- Risk, peril, and hazardThree words candidates use interchangeably in conversation and must separate precisely on the exam.
- Covered causes of loss on the Texas All-Lines examHow the exam tests the burden of proof difference between named perils and open perils, and why that difference decides ambiguous-cause questions.
Sources
- Pearson VUE — Texas Department of Insurance licensing exams
Scheduling, candidate handbook, content outlines, test-center rules, and application timing. Reviewed 2026-07-21.
Requirements, fees, forms, exam details, and deadlines can change. Verify the current rule with the linked authority before scheduling, applying, renewing, or handling a real claim.
For exams on or after September 1, 2026. If your exam is scheduled earlier, use the outline that applies to your exam date. Texas Exam Academy is independent exam preparation and is not affiliated with or approved by the Texas Department of Insurance or Pearson VUE. Verify current eligibility, fees, forms, and requirements with the responsible authority.