New Jersey Life Insurance Practice Exam 2025 – The Complete Guide to Mastering Your Certification!

The term that refers to types of risks that a policy will not cover is exclusions. Exclusions are specific circumstances or situations that are explicitly outlined in an insurance policy where coverage is denied. This can include certain types of risks like pre-existing conditions in health insurance or damage due to acts of war in property insurance.

Understanding exclusions is crucial as they help define the boundaries of the policy and inform the insured about what is not protected, which is key for managing expectations regarding insurance coverage. Inclusions would refer to the risks that are covered, while limitations might specify the extent or conditions under which certain coverages apply. Coverages refer to the general protections provided within the policy. Therefore, exclusions clearly delineate those areas where the insurance company will not provide benefits, making this term integral to the comprehension of policy coverage.