Legal Definitions - block policy

A block policy is a type of insurance policy that covers groups of property against most perils. It is an all-risk policy that can cover property held in bailment or a business's merchandise.

For example, a company that stores goods for multiple clients may purchase a block policy to cover all the goods against damage or loss. This policy would provide coverage for most risks, such as fire, theft, or vandalism.

Other types of insurance policies include:

• Accident policy: insures against loss resulting directly from accidental bodily injuries sustained during the policy term.
• Homeowner's policy: provides coverage for a variety of risks, including loss by fire, water, burglary, and the homeowner's negligent conduct.
• Commercial general-liability policy: covers most commercial risks, liabilities, and causes of loss, including situations in which a business is liable to a third party for personal injury or property damage.

Each policy has specific terms and conditions that determine the coverage provided and the premiums charged. Insurance companies use a process called insurance rating to arrive at a policy premium for a particular risk.