What does an exclusion in a cargo insurance policy do?

An exclusion in a cargo insurance policy specifically serves to delete coverage for certain risks or commodities from the overall policy. This means that if a particular risk, item, or circumstance is listed as an exclusion, the insurance will not provide coverage for losses or damages related to that excluded item, even if they occur during the insurance period. This type of provision allows insurers to limit their liability for specific scenarios that they consider too risky or that they do not want to cover under the terms of the policy.

By defining exclusions, the insurance policy clarifies which risks are not covered, which helps both the insurer and the insured understand the limitations of the policy. Recognizing these exclusions is crucial for cargo owners as it enables them to take additional precautions or seek alternative forms of coverage for those specific risks that are not included in their policy.