Section I Perils Insured Against and Exclusions

Named Perils vs. Open Perils

Section I coverage works one of two ways:

• Named-perils (specified perils): the policy lists exactly what is covered; the insured bears the burden of proving the loss came from a listed peril. Used for personal property on HO-2/3/4/6, and for everything on HO-8.
• Open-perils (all-risk / special form): all direct physical loss is covered unless specifically excluded; the insurer bears the burden of proving an exclusion applies. Used for the dwelling on HO-3 and for both dwelling and contents on HO-5.

This burden-of-proof flip is heavily tested. Open-perils is broader and shifts the proof to the carrier.

The Broad-Form Named Perils

The HO-2/HO-3 personal-property (broad) named perils - know the list:

1. Fire or lightning
2. Windstorm or hail
3. Explosion
4. Riot or civil commotion
5. Aircraft
6. Vehicles
7. Smoke
8. Vandalism or malicious mischief
9. Theft
10. Falling objects
11. Weight of ice, snow, or sleet
12. Accidental discharge/overflow of water or steam
13. Sudden tearing/cracking/burning/bulging of a heating/AC/sprinkler system
14. Freezing of plumbing/HVAC
15. Sudden damage from artificially generated electrical current
16. Volcanic eruption

The first basic perils (HO-8, DP basic) stop around item 8-9; items 10-16 are what make the list "broad."

Section I Exclusions (Apply to All Forms)

Even open-perils forms exclude the following. These are tested as "which is NOT covered":

Concurrent Causation and the Anti-Concurrent Clause

The HO exclusions open with an anti-concurrent-causation (ACC) lead-in: a loss is excluded "regardless of any other cause or event contributing concurrently or in any sequence." So if excluded flood and covered wind combine to damage a roof, the flood-related damage stays excluded even though wind also contributed.

A classic trap: a hurricane brings both wind (covered) and storm surge/flood (excluded). The HO policy pays the wind portion; the flood portion needs NFIP. Adjusters must apportion the loss. Note that fire or explosion ensuing from an otherwise-excluded event is typically covered back (the "ensuing loss" exception).

The Broad-Form Named Perils — Memorize the List

When a form (HO-2, or HO-3 contents) is named-peril, the insured must prove the loss came from a listed peril. The broad-form perils are commonly memorized in groups:

• Fire or lightning; windstorm or hail; explosion; riot or civil commotion; aircraft; vehicles; smoke; vandalism or malicious mischief; theft; volcanic eruption (the core "extended coverage + V&MM + theft" set), plus the broad-form additions:
• Falling objects; weight of ice, snow, or sleet; accidental discharge or overflow of water or steam; sudden and accidental tearing apart/cracking/burning/bulging of a heating or cooling system; freezing of plumbing; and sudden and accidental damage from artificially generated electrical current.

Trap: Flood, earthquake, and surface water are never on the named-peril list and are excluded even on open-peril forms — they require separate coverage.

Section I Exclusions and Anti-Concurrent Causation

The Section I exclusions apply to all homeowners forms, open-peril and named-peril alike. The standard list is earth movement (earthquake/landslide), water damage (flood, surface water, sewer back-up), war, nuclear hazard, neglect, intentional loss, governmental action, and ordinance or law, plus maintenance items — wear and tear, deterioration, mechanical breakdown, smog, rust, mold, vermin, and settling — that are not fortuitous.

Modern HO forms include an anti-concurrent causation (ACC) clause stating that an excluded peril is excluded regardless of any other cause contributing concurrently or in any sequence. The signature application is flood vs. wind: in a hurricane that brings both, the ACC clause denies the flood/storm-surge portion even though covered wind also damaged the home, which is why coastal owners must buy NFIP flood coverage. Expect a fact pattern that mixes a covered and an excluded peril and asks how the ACC clause resolves the claim — the excluded peril wins.

Open-Peril Mechanics and the Burden-of-Proof Flip

On an open-peril form (HO-3 structure, HO-5 structure and contents), coverage is presumed: the insured need only show a direct physical loss occurred, and the insurer must point to an exclusion to deny it. This burden-of-proof flip is the practical advantage open-peril buyers pay for, and it is why fact patterns describing an unexplained or mysterious loss favor the insured under HO-3/HO-5 but may fail under a named-peril HO-2 where the insured cannot identify a listed cause.

Worked contrast: A homeowner discovers the hardwood floor buckled with no obvious cause. Under HO-5 (open peril), the loss is covered unless the insurer proves an excluded cause such as flood, seepage over time, or wear. Under HO-2 (named peril), the same loss is not covered because the insured cannot tie it to a listed peril. The exam rewards recognizing that open-peril forms cover the unknown while named-peril forms cover only the proven-listed.

Remember too that several "perils" are actually written as additional coverages with their own conditions — collapse and glass breakage are covered subject to specific triggers, not as free-standing named perils, so a question may turn on whether the collapse meets the defined causes (hidden decay, vermin damage, weight of contents/snow, defective construction discovered during construction).