The term for when an insurance policy has restrictions based on certain risks is?

The term describing restrictions placed on an insurance policy based on specific risks is "exclusion." Exclusions in an insurance policy delineate what is not covered, effectively limiting the insurer's liability in specified situations. For instance, a health insurance policy might exclude coverage for pre-existing conditions or certain treatments, clearly defining the boundaries of what the policyholder can expect to be taken care of under their plan. Understanding exclusions is crucial for both insurers and insured individuals, as it highlights the potential gaps in coverage that may need to be addressed through additional policies or riders.

The other terms, while related to insurance policies, do not specifically convey the concept of denying coverage for certain risks in the same way that exclusions do. Limitations typically refer to the maximum amount that may be covered under a policy, reservations may imply conditions that must be met for coverage to apply, and deductions refer to amounts subtracted from a claim settlement. Each of these terms addresses different aspects of insurance contracts but does not accurately capture the essence of risks being excluded from coverage.