How do insurance policies generally provide cover for money?

Insurance policies generally provide cover for money on an all risks basis, which means that coverage is offered for loss or damage that occurs from any cause except those specifically excluded in the policy. This approach is particularly important for money, as it is susceptible to a variety of risks, such as theft, loss, or damage, which can occur in numerous unpredictable ways.

The all risks basis of coverage offers a more comprehensive protection for money compared to other cover types. For instance, a named perils approach, which only covers specific, listed risks, would be too limiting for the realities of handling money. Money can encounter various forms of loss that may not be explicitly listed in a narrower coverage policy.

Additionally, options like general liability basis would not typically cover money since they address liability for damages to third parties rather than direct loss of property. Similarly, a replacement cost basis focuses on the monetary value of replacing an item rather than covering it against all risks of loss or damage, which is not suitable for cash and monetary instruments.

Thus, providing coverage on an all risks basis is essential for financial security and caters to the broad spectrum of potential incidents that could affect money.