Auto insurance exclusions

Written by Penny Gusner on July 15, 2013 & Posted in Auto Insurance

When you purchase a car insurance policy, you need to know what the coverages you've chosen will - and will not - cover.

By obtaining state-required liability coverages of bodily injury and property damage, your auto insurance company covers you (up to your limits) if you cause injuries or damage property to others in an auto accident.

If you add on collision to your car insurance policy, you get additional coverage if your car collides with another vehicle or object. If you also include comprehensive coverage as part of your policy, you get coverage for weather-related damages, striking an animal, vandalism and theft.

These, however, are the basics of these coverages. Auto insurance policies come with restrictions and limitations that are listed as exclusions on your coverage.

If something is listed as excluded, it means that your car insurance company won't cover it. For this reason, it's important that you're aware of what your specific auto policy's exclusions are so you won't put yourself into a situation where you won't have coverage and, thus, be left to pay personally for an accident.

Common liability exclusions

  • Named driver exclusion - You and the insurance company agree that a certain individual shouldn't be listed on the policy as a driver, such as a spouse with a suspended license. This type of exclusion you would know about because you must sign a form.
  • Drivers under a certain age (typically 21 or 25).
  • Exclusion of all other drivers but the named insured (typically only if you have a named driver policy)
  • Intentional damage - Insurance policies are for accidents, so purposely damaging your own car or someone else's property with your car isn't covered.
  • Household exclusion - You're unable to make claims under your liability coverages for damages to your own vehicles (or other property like mailbox or garage door) or injuries suffered in your owned vehicle.
  • Use of vehicle for delivery or livery service - If you transport people or goods (even pizza) for money, a personal auto policy typically won't cover you.
  • Using your vehicle for racing purposes isn't covered. This may encompass preparing or participating in organized racing, speeding contests, and street racing.

Physical damage coverage limitations

Collision and comprehensive coverage may include some of the exclusions above as well as the following exclusions:

  • Personal items damaged or stolen from your vehicle
  • Electronic equipment not permanently installed in your vehicle
  • Custom equipment that wasn't listed (and covered) on the policy
  • Losses due to: wear and tear, mechanical breakdown, electrical failure, freezing, catastrophic events (nuclear weapons, war, etc.)
  • Confiscation or destruction of your vehicle by authorities

Exclusions vary by auto insurance company, so check your policy and contact your agent if you have questions about your restrictions.

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