Is employee theft covered by my business insurance?

Not by GL or commercial property. A commercial crime policy is required.

Does my GL cover pollution?

Generally no. Pollution liability is a separate placement.

What is the difference between exclusion and not-covered?

An exclusion is a specific carve-out in the policy. Not-covered can mean either an exclusion or a loss that simply falls outside the policy's grant of coverage. Both end at the same denial.

Typical Commercial Policy Exclusions: What Most Policies Carve Out

Commercial policy exclusions matter as much as coverage: a commercial insurance policy is defined as much by what it carves out as by what it covers. Across general liability, commercial property, business owner's policies, and most package forms, a recurring set of exclusions appears in nearly every contract. Knowing them in advance saves the conversation that starts with "I thought my policy covered that" and ends with a denied claim. This page lists the exclusions that show up almost everywhere, with the separate policy where each is actually addressed. Beaconcover is not a licensed broker; we explain the coverage and route you to carriers.

The short answer

Most commercial policies share a core list of exclusions: intentional acts by the insured, contractual liability beyond a defined carve-back, war and similar acts, nuclear hazards, pollution, asbestos and lead, professional services, employee injuries (workers' comp), auto liability for owned vehicles (commercial auto), employee dishonesty (crime policy), and certain cyber events. Each has a reason it sits outside the policy, and most have a separate coverage line that addresses the exposure. Reading the policy's exclusions section is the only way to know which apply to a specific contract, because forms vary ^{[NAIC: small business insurance, 2026-05]}.

Intentional acts and contractual liability

Intentional acts. Insurance pays for fortuitous loss, not deliberate harm. Every commercial policy excludes claims arising from acts the insured expected or intended to cause injury or damage. The exclusion is narrower than it sounds: a deliberate act with an unintended consequence (a contractor swings a hammer intentionally and an unintended bystander is hurt) is usually still covered, because the harm itself was not intended. A deliberate act with a deliberate harm (an assault, an intentional vandalism by an owner) is not.

Contractual liability. General liability policies usually exclude liability the insured assumes under a contract, with a defined carve-back for liability the insured would have had under common law anyway (the "tort liability" the insured would face whether or not the contract existed). Most policies then add back coverage for "insured contracts", a narrow list of business contract types (leases, sidetrack agreements, easements, indemnification of a municipality, and crucially most ordinary contracts that assume the tort liability of another). The result is that most ordinary indemnification clauses are covered; broader assumptions of someone else's pure contractual liability are not.

War, terrorism, and nuclear

War. Acts of war, declared or undeclared, are universally excluded on commercial property and liability forms. The exclusion has tightened across markets in recent years, particularly on cyber forms, where state-actor cyber operations have triggered carrier disputes over what counts as a "war" act. Read war-exclusion language closely on cyber and on any policy covering operations in geopolitically active regions.

Terrorism. Commercial property and liability policies covering U.S. risks are subject to the Terrorism Risk Insurance Act (TRIA) framework: carriers must offer terrorism coverage, with the insured choosing whether to accept or reject it. Standalone terrorism coverage in addition to or instead of the TRIA-backed coverage exists for larger or higher-exposure operations.

Nuclear hazards. Property loss and liability from nuclear reaction, radiation, or contamination is excluded under standard commercial forms; specialty nuclear placements exist but are not relevant to most small businesses.

Employee dishonesty and crime

Commercial property and general liability forms exclude loss from employee theft, embezzlement, forgery, and most other employee dishonesty. A small business that has been embezzled from by a bookkeeper, or had a deposit forged by an employee, is uninsured under those base lines.

The coverage that responds is a commercial crime policy, sometimes written as an endorsement on a business owner's policy and sometimes as a standalone policy. Commercial crime covers employee dishonesty, forgery, theft of money and securities, computer fraud, funds-transfer fraud, and (depending on form) social engineering schemes. Limits and retentions vary widely; even a modest crime placement (often a few hundred dollars annually for a small operation) closes a serious gap.

Funds-transfer and social-engineering coverage is the part most often under-bought. The CFO-impersonation email that talks an employee into wiring $80,000 to a fraudulent account is a social-engineering loss; not every crime form covers it, and the ones that do often have lower sub-limits than the rest of the form. Confirm before assuming it is in place ^{[III: business insurance basics, 2026-05]}.

Other recurring exclusions

A non-exhaustive list of exclusions that appear on most commercial policies, with the coverage that responds where one exists:

Pollution. Most GL policies exclude pollution-related bodily injury and property damage. Pollution liability is a separate placement.
Asbestos, lead, mold. Class-specific exclusions on many forms; coverage often requires a specialty carrier.
Professional services. Liability for rendering or failing to render professional services is excluded from GL; professional liability (E&O) is the separate line.
Employee injuries. Bodily injury to an employee in the course of employment is excluded from GL; workers' compensation is the response, with employer's liability inside workers' comp picking up most negligence-theory claims.
Owned auto liability. Vehicles owned by the business are excluded from GL; commercial auto is the response.
Watercraft and aircraft. Mostly excluded from GL with narrow carve-backs.
Recall costs. Excluded from GL products coverage; product recall is the separate policy.
Wear and tear and gradual deterioration. Excluded from property coverage; no policy responds.
Earth movement and flood. Often excluded from standard property forms; earthquake and flood are separate placements (flood frequently through the NFIP for residential and small commercial).
Employment practices. Discrimination, harassment, and wrongful-termination claims are excluded from GL; EPLI is the response. See /coverage/employment-practices-liability/.
Cyber events. Most GL and BOP forms now contain a cyber-event exclusion, sometimes broad; cyber liability is the response. See /coverage/cyber-liability/.
Knowing violations of statute. Many forms exclude claims arising from the insured's knowing violation of statute (e.g., TCPA, BIPA), with state-by-state variation in enforceability.

How do you read your declarations page?

The declarations page lists the coverage parts, limits, deductibles or retentions, and any specific endorsements modifying the policy. Three things to check on a small-business commercial policy:

Coverage parts in force. Confirm general liability, products-completed-operations, personal-and-advertising-injury, and any other parts you expect are listed with non-zero limits.
Specific exclusion endorsements. Carriers add exclusion endorsements at quote: a "subsidence" exclusion in some states, a specific-class exclusion (firearms, supplements), a designated-operations exclusion. If something is endorsed off, the dec page tells you.
The schedule of underlying for any umbrella. If you have an umbrella, the schedule has to match what you actually carry on the underlying policies. A mismatch is the most common cause of an umbrella not responding.

If anything on the dec page does not match what you bought, raise it with the broker or carrier in writing before a claim, not after ^{[SBA: get business insurance, 2026-05]}. See /methodology/ for the six dimensions we look at on any plan.

Frequently asked questions

Intentional acts, war, nuclear, pollution, professional services, employee injuries, owned-auto liability, employee dishonesty, and most cyber events. Each has a separate line that responds.

Not a broker. Beaconcover is an independent comparison site. We are not a licensed insurance broker, agent, or adviser; we route you to providers and do not sell, bind, or advise on policies, and nothing here is legal or tax advice. Coverage, price, and requirements vary by state, profession, payroll, and underwriting. See /methodology/ and /disclosure/. Last reviewed: 2026-05-27.