What Are Insurance Policy Exclusions?

Insurance policy exclusions are present in all types of insurance. They describe situations in which the insurance company would not pay claims for costs associated with an event. Exclusions help to keep insurance premiums more uniform and reasonable.

Homeowner's Insurance

Common exclusions in homeowner's insurance are earthquakes, sinkholes, floods and landslides. Special policies should be purchased by homeowners in areas where the likelihood of such events is higher than usual.

Auto Insurance

Auto insurance normally excludes coverage for damages incurred by intentionally wrecking your vehicle or racing it, and to custom parts that are valued at more than what was listed on the application.

Disability Insurance

On disability insurance policies, there usually are exclusions for disabilities as a result of acts of war, illegal activity and pre-existing conditions. Some policies will not cover disabilities stemming from substance abuse or mental disorders during the first two years of the policy.

Life Insurance

Life insurance policies commonly exclude claims as a result of an act of war, suicide during the first two years of the policy, dangerous activities, and pre-existing medical conditions.

Health Insurance

Pre-existing medical conditions are often excluded from coverage on health insurance policies. Some insurance companies offer exclusion riders that exclude payment for claims for treatment of the excluded condition but allow payment for other medical treatment.

References

• IntelliQuote: Review Our Glossary of Auto Insurance Terms: Basic Coverage Definitions for Auto Insurance--Collision
• Insure.com: Home Insurance Exclusions: What Your Policy Won't Cover
• My Life Insured: The Process of Buying Life Insurance: Examining Terms and Understanding Exclusions: Exclusions