Ordinance or Law:
Means losses from legal stuff relating to construction, repair, or any tearing down or debris removal.
Earth Movement:
Refers to damages/losses from things like landslides, mudslides, sinkholes, earthquakes (there’s a separate policy for this if you want), and any other earth movement including earth sinking, rising or shifting.
Water:
We’re talking flooding from the outside-in: natural stuff like groundwater, tidal water, tsunamis, etc. as well as flooding caused by sewer blockages or broken sump pumps.
Caveat? For the natural stuff, you have flood insurance. Look into it when you’re getting a policy.
Power Failure:
This one’s pretty specific… if a power failure causes loss to stuff that isn’t on your property (even if it was a result of a named peril), it’s not covered.
Neglect and Intentional Loss:
Like most things that aren’t covered in your insurance policy, neglect and intentional loss fall under the category of stuff you can prevent. Once a loss happens, if you don’t do everything in your power to make things right, then it’ll be considered neglect – if you did it on purpose, it’s intentional loss.
War and Nuclear Hazard:
Quite simply, losses from war and nuclear hazard are excluded from your coverage.
Governmental Action:
This exclusion deals with good ‘ole Uncle Sam… if for some reason the government decides to do something that causes a loss, it’ll be excluded from your insurance coverage, unless the governmental action happened because of a named peril.
Note: in terms of personal liability, most of the exclusions have to do with vehicles and other things with engines if you’re the one in control/driving.
FAQs
Typical examples of excluded perils under a homeowners policy are flood, earthquake, and nuclear radiation. A typical example of an excluded loss under an automobile policy is damage due to wear and tear.
What is the exclusion clause in an insurance policy? ›
Similarly, exclusions are a type of clause that dictate what is not covered by the contract. For example, the policyholder's spouse will not be covered if the policy buyer opts for an individual life insurance contract. The non-coverage of a spouse comes under insurance exclusions.
What is the exclusion of insurance risk? ›
An insurance exclusion specifies which events your policy won't cover, essentially narrowing the scope of coverage. These exclusions help insurers avoid risks they find too high or unpredictable. Sometimes, your policy only lists the perils it covers, meaning everything else is automatically excluded.
What is a common exclusion to property insurance coverage? ›
Infestations
Bedbugs, termites, mice and other vermin are typically excluded from home insurance for the same reason wear and tear isn't covered. From an insurer's perspective, getting rid of infestations and fixing the damage left behind are simply part of maintaining your home.
What is the general exclusion of insurance? ›
Loss, destruction or damage that existed before the policyholder applied for home insurance is excluded from coverage. For example, a home insurance policy may not cover any losses caused by water leakage that existed in a newly build property when the owner moved in.
What are two of the most common exclusions used by underwriters? ›
Risky activity: Any death due to risky activities, such as skydiving or rock climbing, are usually counted as an exclusion. Substance abuse: If a policyholder's death is the result of drug or alcohol abuse, it may be excluded from their policy.
What is an exclusion clause in simple words? ›
An exclusion clause is a clause that excludes or restricts liability. Therefore, it is a clause under which a party seeks to exclude or limit its liability for non-performance of the contract.
What does being excluded from insurance mean? ›
An excluded driver is a person in your household who has been explicitly excluded from coverage under your car insurance policy. Their name will show as "excluded" on your policy, and they won't be insured to drive any vehicles on your policy.
What are exclusions in term insurance? ›
If the policyholder dies due to criminal activities, the Term Insurance policy may not cover it. This Exclusion is in place to prevent insurers from paying out for events caused by illegal behaviour.
What is the exclusion period of insurance? ›
The time period during which a health plan won't pay for care relating to a pre-existing condition.
Definition of 'exclude a risk'
If an insurance company excludes a risk, they declare that a particular risk is not covered by an insurance policy. Most property insurance policies exclude risks such as malfunction of a boiler or other machinery.
What does benefit exclusion mean in insurance? ›
A benefits payable exclusion is a clause in insurance policy contracts that removes the insurer's responsibility for paying claims related to employee benefits.
How do insurance exclusions work? ›
An exclusion is a provision within an insurance policy that eliminates coverage for certain acts, property, types of damage or locations.
What are the key person insurance exclusions? ›
The most common key person insurance exclusions are fraud, misrepresentation, and suicide. A claim can be denied in case of a proven instance of intentional dishonesty. During the first two years of every life insurance policy, there is a contractual clause known as the contestability period.
What is the exclusion clause in insurance? ›
An exclusion is an event (peril, accident, incident, or accusation) that an insurance policy will not cover. A standard insurance policy will typically include some exclusions. While insurance policies help small businesses mitigate risk, they don't cover everything.
What is a exclusion clause example? ›
An exclusion clause is a clause that excludes or restricts liability. Therefore, it is a clause under which a party seeks to exclude or limit its liability for non-performance of the contract. For example, such a clause may set a monetary cap on liability or restrict or exclude the rules of procedure or evidence.
What is an example of exclusion of liability? ›
NEITHER PARTY SHALL BE LIABLE TO THE OTHER PARTY (OR TO ANY PERSON OR ENTITY CLAIMING THROUGH THE OTHER PARTY) FOR ANY LOSS OF PROFITS, LOSS OF USE, BUSINESS INTERRUPTION, OR INDIRECT, SPECIAL, INCIDENTAL, PUNITIVE, OR CONSEQUENTIAL DAMAGES OF ANY KIND IN CONNECTION WITH OR ARISING OUT OF THE PERFORMANCE OF THIS ...
What are common exclusions to a health insurance policy? ›
Some common excluded services include: Alternative medicine (e.g., acupressure, yoga, acupuncture, massage, biofeedback) Dental services. Vision care.
