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An insurance exclusion is a provision in your policy that removes cover for a specific circumstance, event, condition, or type of loss. Exclusions define the limits of what your insurer will pay for, and understanding them before you need to claim is essential to avoid surprises.
While exclusions vary by policy type, common ones across most general insurance products include: intentional damage by an insured person, illegal activities, wear and tear or gradual deterioration, pre-existing damage, consequences of war or nuclear events, and losses arising from a failure to maintain the property or asset. For business insurance, interruption not caused by physical damage (such as a pandemic) is commonly excluded unless specifically endorsed.
Some exclusions can be removed through a policy endorsement — a written modification to the standard policy. For example, a home policy might exclude flood in your postcode, but flood cover can sometimes be added for an additional premium. Similarly, a business policy excluding a specific activity can sometimes be endorsed to include it if the insurer is willing to underwrite the additional risk. Your broker is best placed to negotiate these endorsements.
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