Covering indexes in Couchbase Server 4.1 enhance query efficiency by allowing data to be returned directly from the index, eliminating the need for document look-ups. This concept, borrowed from the relational/SQL world, involves creating an index that encompasses all the data needed for a query, thus bypassing several steps in the query process. In Couchbase, when a N1QL query is executed, it typically involves parsing the query, checking indexes, fetching document keys, retrieving documents, extracting data, and returning results. However, with a covering index, the query can be satisfied directly from the index, skipping the document retrieval steps. Setting up a covering index involves ensuring that a single index covers every JSON key touched by the query, as demonstrated with an example involving customer profiles and newsletter subscriptions. For further information, Couchbase Server documentation provides additional details on implementing covering indexes.