Exposure

Plain English Definition: Exposure refers to the level of risk or potential for loss covered by an insurance policy.

What Exposure really means for someone with an insurance policy

Exposure indicates how much risk an insurer assumes when providing coverage. Higher exposure typically leads to higher premiums due to increased potential for claims.

Exposure Real World Examples

• A home located in a hurricane-prone area has higher exposure due to the risk of storm damage.
• A high-value vehicle with expensive repair costs increases exposure for an auto insurer.
• Operating a business with hazardous materials raises exposure for liability insurance.