listed in a personal auto insurance policy vary depending upon what
state laws permit and then the guidelines of your car insurance
company. When something is noted as excluded on your policy,
it means that your policy won't cover it.
Exclusions can be associated with a person, property, location,
peril or specific situation.
These limitations to your coverage are important to know so that
you don't end up in a situation where you find out after an auto
accident that you have no coverage -- or have voided your
policy. (Remember if your policy doesn't cover you, then
you'll be stuck
The most common exclusion regarding a person is a
named driver exclusion
. With this, you and your insurer agree to exclude a specific
person from your policy's coverages. This driver isn't rated
on your policy, and in return your insurer won't cover the
individual if found driving your car.
Here's a look at some of the most common exclusions found in the
different parts of a personal auto insurance policy.
Bodily and property damage liability exclusions
Most policies plainly state they don't provide liability
- If an insured has
intentionally caused injury or property
- For property damage to property owned (or being transported)
by the insured. (So if you hit your own car you can't make
a liability claim)
- For property damage to property that is rented, used by or in
the care of the insured.
- For bodily injury to the insured or any member of an
insured's family residing in the insured's household. (Some
states only allow the policy to reduce the bodily injury limits
for family members to the state's minimum)
- For liability arising out of the ownership or operation of a
vehicle being used for "livery conveyance." This
means using your vehicle in transportation of goods or people for
payment - so don't use your car as taxi or delivery
service. So, don't use your car for delivering
pizzas, or you may void your coverage.
In general, using your vehicle for business purposes can be a
no-no according to your liability policy. For example, it may
say that the business of:
- Selling, repairing servicing, storing or parking vehicles
(other than your insured vehicles) is not covered by your
liability or physical damage coverages.
- Maintaining or using any vehicle that the insureds are using
to engage in business --other than farming or ranching - may not
covered. (If you are using your vehicle for business, see
about a business-use or commercial policy)
Catastrophic events or exposures are usually marked as excluded
as well. This can include items such as bodily injury or
property damage resulting from:
- Nuclear exposure or explosion - including the resulting fire,
radiation, or contamination.
- Bio-chemical attack or exposure to bio-chemical agents as a
result of an act of terrorism.
- War (declared or undeclared)
Vehicles that are excluded from coverage (or deemed unacceptable
to cover for either liability or physical damage coverages) vary
but the list may include:
- One with less than four wheels
- Designed for use principally off public roads or not
registered for use on public roads
- Any vehicle owned by you or a family member but isn't listed
as insured on your policy.
- Any vehicle furnished for your regular use but isn't listed
as insured on your policy.
- Any vehicle used for the purpose of competing in a race or
practicing or preparing for any prearranged or organized racing
or speed contest.
Some insurers have amended policies to include an exclusion for
any vehicle that is operated, maintained, or used as part of a
personal vehicle sharing program. So, loaning your vehicle
out for to a car-sharing service could mean you have no personal
Physical damage coverage exclusions
Collision and comprehensive coverage are the physical damage
coverages offered by auto insurers. While liability insurance
covers those that you damage, collision and comprehensive cover
your own vehicle if it's damage.
Exclusions under this portion of the policy can be similar in
many ways to the restrictions listed in your liability portion of
your policy. Typically, collision and comprehensive coverage
exclusions include loss or damage due to:
- Wear and tear
- Mechanical or electrical breakdown or failure
- Road damage to tires
- Catastrophic events - radioactive contamination, nuclear
weapon discharge, war, etc.
- Destruction or confiscation by government or civil
- Using your vehicle for livery or delivery purposes
- Vehicle being used for racing purposes
- Intentional damage
- Vehicle used in personal car sharing programs (some
Personal items that are damaged in your vehicle or stolen from
it aren't covered, and most policies specifically mention the
exclusion of coverage for losses to:
- Any electronic equipment that is not permanently
- Custom equipment (or is covered to a specific minimal amount
-- such as $2,000) unless you've added a custom parts and
equipment endorsement to your policy.
If a vehicle is excluded from liability coverage, then typically
it's also unable to obtain physical damage coverage.
However, there are some vehicle that insurers allow to obtain
liability but not collision and comprehensive -- such as vehicles
with a salvage or rebuilt title.
Medical payments and uninsured motorist bodily
Medical coverages you can purchase for yourself as part of an
auto insurance policy have exclusions as well. Typically,
they include injuries sustained in circumstances mentioned above,
such as catastrophic events, racing or livery service, as well as
situations such as:
- Injured on a motorized vehicle having fewer than four
- Injured while using the vehicle as a residence
- Injuries that workers compensation benefits should cover
because occurred during the course of work
Besides exclusions, a policy may have other restrictions to look
for. (See "7 gotchas of cheap insurance")
To be aware of your exclusions and restrictions, read your
policy and then contact your car insurance company if you have