What type of peril basis does the Basic Form Dwelling Policy operate under?

The Basic Form Dwelling Policy operates under a named peril basis. This means that the policy specifically lists the perils that are covered, as opposed to providing coverage for all risks or perils unless they are explicitly excluded. In a named peril policy, if a peril is not listed in the policy documents, it is not covered. This type of coverage is designed to protect owners against specific types of loss, which makes it vital for policyholders to closely review the list of covered perils to understand what is and isn’t included in their coverage. Thus, the clarity of the named peril basis is beneficial for homeowners to know exactly what risks they are insured against.