In insurance it refers to a loss from a certain hazard or event such as “fire” or “lightning”. Each policy will list the covered perils and sometimes they even list perils that are not covered. If something is not covered it usually means that you can find coverage for that peril somewhere else. For example, most homeowner policies do not include “flood” as a covered peril because you would need to purchase a separate flood policy to cover that peril.
There are different packages you can purchase that will include or exclude different perils. On commercial property you will often see the option for basic, broad, or special coverage forms. Depending on your business and your exposure one business may only need the basic form covered and the next business may need special form. We always recommend the special form as it provides the broadest coverage.
You will find that most homeowner policies have different deductibles for different perils. Some will offer a flat deductible for all covered perils. It is common now for companies to assign a deductible for “wind & hail” losses with a separate deductible for “all other peril” or “AOP”. Below is a photo from a homeowner’s policy that clearly shows which perils are covered for the home. The second photo shows the different deductibles on a policy.