What is the wear and tear exclusion in insurance?

October 20, 2016

 

Wear and tear is a common exclusion in your property and auto insurance policies. Understanding what it excludes can help you in the event of a claim.

 

What does Wear and Tear Exclusion mean?

 

A wear and tear exclusion is a provision in an insurance contract that states that the policy does not cover degradation from everyday, normal use. Because every piece of property deteriorates over time, it would be too expensive for insurers to cover such losses. Insurance only covers losses due to unexpected events. Normal wear and tear cannot be avoided, and therefore, insurance policies do not cover it.

If insurers did not exclude wear and tear, they would essentially have to eventually pay for replacement or repairs to every building, tool, and piece of office equipment they insure. This would mean dramatically raising the premiums in order to pay for these expenses. Auto insurance, for example, only covers unforeseen events, such as accidents, and does not cover replacements of car parts that wear down over time, such as filters, hoses, and brake pads.

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