No Insurance Policy Covers Every Possible Risk of Loss & That is Why Exclusions Exist

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Exclusions

An exclusion is a provision of an insurance policy referring to hazards, perils, circumstances, or property not covered by the policy. Exclusions are usually contained in the coverage form or causes of loss form used to construct the insurance policy. One common exclusion is a clause that prohibits coverage for an intentional loss.

In some states, like California, a statute prohibits insurance of intentional acts (In California, it is Insurance Code § 533). It should be axiomatic that to pay for an intentional loss defeats the purpose of insurance.

To comply with statues like the California statute, insurance policies contain specific exclusions to limit the coverages available to indemnity for fortuitous or accidental losses. However, not all apparently intentional acts are covered by the exclusion.

Insurance policies contain specific exclusions to limit the coverages available to indemnity for fortuitous losses.