Standard Exclusions
All risk insurance, despite its comprehensive-sounding name, contains significant standard exclusions across virtually all policies. Flood damage is universally excluded, requiring separate specialized coverage through the National Flood Insurance Program or private insurers. Earthquake and earth movement damage (including sinkholes and landslides) remain excluded, necessitating specific endorsements or standalone policies. War, terrorism, and nuclear incidents are standard exclusions in all risk policies. These fundamental exclusions reflect catastrophic risks that require specialized underwriting approaches beyond standard all risk coverage frameworks.
Wear and Deterioration
All risk policies explicitly exclude damage resulting from normal wear and tear, gradual deterioration, or lack of maintenance. Mechanical breakdowns of systems and appliances generally fall outside coverage unless resulting from a covered peril. Inherent vice—the natural tendency of certain objects to deteriorate due to inherent qualities—remains excluded. Rust, rot, mold, and corrosion typically receive no coverage unless directly resulting from a covered water damage incident. These exclusions reflect the insurance principle that policies cover sudden and accidental losses rather than inevitable deterioration over time.
Intentional or Foreseeable Loss
Losses caused by deliberate actions remain outside all risk coverage. Intentional damage by the policyholder or their representatives receives no protection. Criminal acts by insured parties are excluded, though innocent co-insureds may retain coverage in some jurisdictions. Failures to protect property after initial damage (like leaving a storm-damaged roof unrepaired) may void coverage for resulting secondary damage. These exclusions reflect the fundamental insurance principle that policies cover fortuitous (unexpected and unintended) losses rather than deliberate actions.
Professional Liability Exposure
All risk property policies exclude professional liability and errors and omissions exposures. Damages arising from professional advice, services, or failure to perform professional duties require separate professional liability coverage. Business-related liability exposures generally fall outside all risk property policy protection. Financial losses without accompanying physical damage typically receive no coverage under all risk policies. These divisions maintain the distinction between property insurance and professional liability exposures, which require fundamentally different underwriting approaches.
Policy-Specific Exclusions
Beyond standard exclusions, individual all risk policies may contain unique limitations based on specific risk factors. Properties with historical loss patterns might face customized exclusions for recurring issues. High-risk locations might see exclusions for certain region-specific perils. These tailored exclusions reflect the insurer's specific risk appetite and underwriting guidelines rather than industry-standard limitations.