A specific situation or loss that your policy does not cover.
Exclusions carve out specific risks, events, or circumstances from coverage. Common startup exclusions include prior known claims, intentional acts, and specific industry risks. Exclusions are where policies differ most.
An exclusion is a specific risk, event, or circumstance that your policy explicitly does not cover. Exclusions are listed in the policy and define the boundaries of your coverage—everything the insuring agreement grants can be narrowed by an exclusion. Reviewing exclusions is the most important part of comparing two policies.
Common exclusions include prior known claims or circumstances (issues you were aware of before the policy started), intentional or fraudulent acts, bodily injury/property damage (excluded on E&O and D&O—that's GL's job), insured-vs-insured disputes on D&O, and increasingly, specific AI or emerging-technology risks on Tech E&O. Cyber policies often exclude prior breaches and unpatched-system incidents.
Sometimes. Certain exclusions can be removed or narrowed through an endorsement, often called a "buy-back," usually for an additional premium. Whether an exclusion is negotiable depends on the carrier, your risk profile, and the coverage line. A broker can identify which exclusions are standard and which are negotiable before you bind.
Definitions are educational and may be modified by your specific policy language, endorsements, and state rules. For regulatory guidance, refer to the California Department of Insurance or the NAIC.
Last updated: July 2026.