Two types of exclusions

The first is a standard (or policy) exclusion – one that applies to everyone on that policy, regardless of personal circumstances. A common example is cosmetic procedures that aren't medically necessary, which many health insurance policies won't cover as a matter of course.

The second is an individual exclusion – one applied specifically to you, based on your health, lifestyle or occupation. If you've had a previous knee injury, for instance, an insurer might offer you full cover except for claims relating to that knee.

Why do insurers apply exclusions?

When an insurer reviews your application, they're assessing the likelihood of a future claim. Where they identify higher risk, they have a few ways to respond:

• Accept cover on standard terms – the risk is within normal range and cover is offered as normal, with no changes.
• Apply an exclusion – cover is offered, but claims related to that condition won't be paid (either permanently or for a set period).
• Add a premium loading – the condition is included, but the premium is higher to reflect the extra risk.
• Decline – in some cases, the risk is considered too high to offer cover at all. 

In other words, an exclusion is often what allows an insurer to offer cover in the first place. Without it, the risk may simply be too high for them and they might decline the application altogether. 

Common situations where exclusions may apply

Every insurer assesses risk differently, but most exclusions arise around:

• Pre-existing medical conditions
• Previous injuries or surgeries
• Certain high-risk occupations
• Risky hobbies or activities
• Ongoing treatment or investigations

That’s why two people with similar health histories can receive quite different terms from different insurers. So researching your options, and getting professional advice, can make all the difference.

Not all exclusions are permanent

This is the part many people don't realise: individual exclusions aren't always permanent.

Depending on the condition, if it has stabilised, improved or been symptom-free for a number of years, your insurer may be willing to take another look. There's no guarantee, and it varies between providers – but assuming your original terms are set in stone isn't the right approach.

Make sure you review your cover on a regular basis, especially if your health has changed since you first took out the policy. We can help you with this. 

Honesty is the best policy

Honesty during the application process matters a lot. 

Insurers rely on what you tell them to assess your application accurately. That means disclosing your health history, lifestyle, occupation and any ongoing treatments, even if you're not sure they're relevant.

Failing to disclose information, no matter whether intentionally or not, can create serious problems if you ever need to make a claim. If you're unsure whether something is worth mentioning, err on the side of caution – disclose, disclose, disclose. 

How your Insurance Link adviser can help

Exclusions are rarely black and white. The way you present your information during the application process can make a real difference to the terms you're offered, and that's where having an Insurance Link adviser in your corner matters.

We can help you understand what any exclusion means for your situation, compare options across providers and make sure nothing important gets missed along the way.

Remember: a pre-existing condition doesn't automatically mean no cover, and an exclusion doesn't mean the conversation is over. Get in touch to learn more.

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current development or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek financial advice.

A full disclosure statement for each Insurance Link Adviser is available on request and free of charge.