Which term describes an insurance policy that does not cover any losses incurred while the insured was committing illegal acts?

The term "exclusions" refers specifically to specific circumstances or events that are not covered by an insurance policy. When an insurance policy includes exclusions related to illegal acts, it means that any losses or damages occurring while the insured was engaged in illegal activities will not be compensated by the insurer.

Understanding exclusions is crucial for policyholders, as they define the boundaries of coverage and help clarify what is specifically omitted from the insurance protection. This aids in ensuring that policyholders are aware of the limitations of their coverage and encourages them to adhere to legal activities to maintain their insurance protection. In the context of the question, since the losses incurred during illegal acts are excluded from coverage, the correct term to describe this aspect of the policy is indeed exclusions.

Limitations, conditions, and liabilities have different implications in insurance. Limitations refer to caps on the amount an insurer will pay, conditions are specific requirements that must be met by the insured for coverage to be valid, and liabilities specifically pertain to the responsibilities or potential claims against the insured, all of which do not directly relate to the inability to cover losses resulting from illegal acts.