Coverages, exclusions, conditions, and coverables overview

A coverable is an exposure to risk that can be protected by the policy. A coverable might be any of the following:

  • A tangible property item
  • A location
  • A jurisdiction
  • The policy itself

Within PolicyCenter, Guidewire makes the policy line a coverable to represent the named insureds. Coverages, exclusions, and conditions are attached only to coverables. You can further subdivide coverables into property coverables and liability coverables.

  • Property coverables are things with physical attributes (height, weight, value, construction type, age, and similar attributes, for example).
  • Liability coverables are operations represented typically by class codes (coal mining, personal auto operation, for example).

Coverages

In contrast, a coverage is protection from a specific risk. Coverages are always attached to a coverable. You can divide coverages into the same two types as well: property and liability. For example, on an auto policy, a collision property coverage protects the vehicle owned by the insured. A liability coverage protects the driver for damage done to a vehicle owned by someone else. Liability coverage provides insurance for the operation of the vehicle. It does not provide insurance for the car, bus, or snowmobile.

Using a vehicle as an example:

  • Theft of items in a car – The coverable is the vehicle and the type of loss is theft.
  • Car collision – With collision coverage, the coverable is the vehicle owned by the insured. With comprehensive coverage, the coverable is the whole policy, covering damage to the other vehicle through liability.

Exclusions and conditions

Similar to coverages, exclusions and conditions are always attached to a coverable. While a coverage defines protection from a specific risk, an exclusion defines a risk that is explicitly not protected.

Conditions define other contractual obligations of the insurance policy that are neither a coverage nor an exclusion. A condition is policy provision that defines required behaviors for the carrier and insured. A common example of a condition is a state amendatory endorsement that details requirements in a single jurisdiction.

Using a vehicle as an example again:

  • Loss while under the influence of alcohol – The coverable is the whole policy, meaning the insured. The exclusion exempts any loss while the insured is under the influence of alcohol.
  • Policy-wide deductible – The coverable is the whole policy, meaning the insured. The condition stipulates that all coverages use the same deductible.