Exclusion Rider
What Does Exclusion Rider Mean?
An exclusion rider is an endorsement or provision in an insurance policy that specifies the perils or hazards that the insurer will not cover.
Policyholders can purchase supplemental policies to address the coverage gaps created by these riders.
Insuranceopedia Explains Exclusion Rider
Policyholders should be aware of which perils or hazards their policy excludes to avoid unexpected financial burdens from uncovered losses.
For example, a home insurance policy may provide coverage for water damage. However, if it includes an exclusion rider for damage caused by burst pipes, the policy will not offer protection or compensation for water damage resulting from a pipe bursting.
Certain types of flooding are also commonly excluded from homeowners‘ and renters’ insurance policies. Those who purchase these policies should carefully review any exclusion riders to understand the types of damages not covered by the insurance policy, which they will need to pay for out of pocket.
