CII Certificate in Insurance 2026 - Award in General Insurance (non-UK) (W01) Practice Test: Your All-in-One Resource for Exam Success!

A 'named perils policy' specifically refers to an insurance policy that provides coverage for only those risks that are explicitly listed in the policy document. This means that if a peril is not named, it is not covered, making the coverage more limited compared to an all-risk policy, which would cover a broader range of potential incidents.

The policy operates by clearly defining the situations under which a claim can be made. For example, common named perils may include fire, theft, flood, or vandalism. When the event causing loss or damage is one of the specified perils, the insured can make a claim. However, any loss caused by an unlisted peril would not be covered under this type of policy.

In contrast, a policy that covers all risks would provide broader protection, making it different from a named perils approach. The other options, such as life insurance or liability exclusion policies, address different kinds of coverage that do not relate to the concept of named perils.