What type of peril coverage does an HO-5 policy provide for personal property?

An HO-5 policy, commonly known as a Comprehensive Homeowners Policy, provides coverage for personal property on an open peril basis. This means that the policy covers all perils unless they are explicitly excluded in the policy's wording. This is a more comprehensive approach compared to named peril policies, which only cover specific risks that are listed in the policy.

The open peril basis is beneficial for policyholders because it offers broader protection, allowing them to have peace of mind knowing that their personal belongings are safeguarded against a wide range of potential threats. This includes risks like theft, fire, and vandalism, among others, giving it an advantage for comprehensive personal property coverage.

In contrast, a named peril basis limits coverage to only those perils specifically mentioned in the policy, which could leave gaps in protection. A limited peril basis would further restrict this coverage, and stating that there is no coverage would imply an absence of protection, which is not accurate for an HO-5 policy. Thus, the classification of coverage as open peril is what distinguishes the HO-5 policy as a robust option for homeowners regarding personal property protection.