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What are ‘exclusions’ and ‘limitations’ and how do they affect my coverage?
An "exclusion" is a statement in an insurance policy which describes a condition or type of loss that is not covered by the policy. An exclusion is an exception to the general statement of coverage contained in the policy. For example, an auto liability policy typically states that it will pay damages for bodily injury or property damage for which an insured becomes legally responsible because of an auto accident. The same policy typically would have "exclusions" that provide, for example, that there is no coverage if the injury is caused intentionally or if the injury is caused by a person who uses an insured vehicle without permission.
A provision found in some policies which is similar to an exclusion is called a "limitation." A limitation also is an exception to the general statement of coverage but is applicable only under certain circumstances or for a specified period of time. For example, a health insurance policy often contains a "preexisting conditions" limitation, which states that the coverage does not apply to an illness or other medical condition that has been treated or diagnosed within a certain period of time (e.g. six months) prior to the beginning of the policy. However, after the policy has been in effect for a specified period of time (often six months to one year), the limitation will no longer apply and subsequent treatment for the preexisting illness or condition will be covered.
Since exclusions and limitations "take away" some of the coverage of the policy, the law requires that they be clearly written and very specific. In the event of a reasonable difference of opinion over how to interpret the meaning of an exclusion or limitation, a court generally will resolve the dispute in favor of the policyholder by adopting the narrowest or most restrictive interpretation. |
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Are there legal limitations on insurance company business practices?
Are there any limitations on what an insurance company can charge for insurance?
Can an insurance company cancel my policy for any reason it chooses?
Can I cancel my policy at any time and will there be a penalty?
What happens when there is a claim?
If I am sued, does my insurance company defend me in court?
If I am sued, can my insurance company settle the case without my consent?
What is a ‘reservation of rights’ letter?
What can I do when an insurance company refuses to pay a claim?
Lawsuit for ‘bad faith’
Are there any options for resolving a dispute with my insurance company other than suing the company in court?Arbitration
Complaint to department of insurance
What are ‘exclusions’ and ‘limitations’ and how do they affect my coverage?
Are there any government agencies that regulate how insurance companies operate?
Why would someone need or be required to have insurance?
Is a business required to provide health, life and other insurance coverage for its employees?
What is an insurance policy?
What is an ‘insurable interest’?
What am I required to do when I have a claim?
Can an insurance company refuse to sell me insurance for any reason it chooses?
If I miss a premium payment and get a cancellation notice, is there anything I can do to be able to keep the policy?
If I think certain words in my policy mean something different from what my insurance company says they mean, how do we resolve it?
How does an insurance policy ‘protect’ me?
I have a friend who is an avid motorcycle rider and who particularly enjoys driving while drunk. Can I take a out a large insurance policy on him? My odds of collecting are higher than the lottery!
We have a policy limit of $100,000. Does this mean that any medical bills, damages, legal fees, etc. That exceed that limit are my responsibility?
Why does it matter that I give an adjuster my social security number?
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