What Is a War Exclusion Clause in an Insurance Contract?

A war exclusion clause explicitly excludes coverage for losses caused by war-related events, such as invasions, insurrections, revolutions, military coups, and certain acts of terrorism. It means the insurer is not obligated to pay claims that arise from those perils.

Why insurers include war exclusions

• Catastrophic exposure: War can produce extremely large, simultaneous losses that could bankrupt an insurer.
• Uninsurable uncertainty: Insurers cannot accurately calculate premiums for the scale and unpredictability of war-related risk.
• Voluntary higher risk: Life and disability policies commonly exclude war-related losses when an insured voluntarily enters military service, which raises their risk profile.

Policies commonly affected

• Property and casualty policies — auto, homeowners, renters, and commercial property often contain war exclusions.
• Liability policies — exclusions can limit insurer liability for claims tied to war or politically motivated violence.
• Life and disability policies — many exclude death or disability resulting from war or active military service, or they include specific military-service provisions.

Alternatives and exceptions

• War risk insurance: Entities operating in high-risk regions (e.g., businesses, shipping, airlines) can often purchase separate war-risk or political-risk cover to protect against losses excluded by standard policies.
• Government backstops for terrorism: In some jurisdictions, public programs or legislation (for example, terrorism insurance backstops) help stabilize the market for certain terrorism-related losses, but these do not eliminate war exclusions generally.

How the clause evolved

After large-scale terrorist attacks, insurers broadened standard exclusions to cover a wider range of “war and terrorism” events beyond contractually assumed liabilities. As a result, many policies today incorporate expanded war/terrorism exclusions unless specific terrorism cover is purchased or government programs apply.

Practical tips for policyholders

• Read policy language carefully to see how “war,” “terrorism,” and related terms are defined.
• Ask insurers whether terrorism or war-risk endorsements are available and what they cost.
• Businesses in politically unstable areas should explore war-risk or political-risk insurance.
• If you or a covered person may enter military service, check life and disability policy provisions regarding deployment and war-related exclusions.

Key takeaways

• A war exclusion clause removes insurer liability for losses caused by war and similar events.
• Insurers use the exclusion to avoid catastrophic, unpredictable losses they cannot reasonably price.
• Separate war-risk or government-backed programs may be available for some kinds of war- or terrorism-related losses.