ABSTRACT
Exclusions are usually set out in a separate section of liability policies headed "Exclusions"; this is usually sufficient to distinguish them from what insurance law calls "warranties", which are usually found in a section of policies headed "Conditions". Certain exclusions reflect and reinforce the insurer's concern with moral hazard: an aspect of general human behavioural weakness, the risk of which the insurer is unable or unwilling to assume. Policies commonly exclude cover for death, bodily injury or sickness to other persons. Sometimes excluded is liability for damage to the property of other people. If the claim against the insured is based on both negligence and breach of contract, the claim is covered. Profession indemnity (PI) cover purports to cover the activity of the professions. If a claim made against the insured alleges not only negligence but also fraud, there is no cover for the fraud. Many policies, however, qualify the exclusion and concede limited pollution cover.
