Relatives Clause
The relatives clause excludes, in liability insurance, claims brought by relatives of the policyholder who live with them in the same household or are co-insured under the policy.
- Clause type
- Exclusion
- Origin/Market
- German market
- Favours
- Insurer
- Negotiability
- Market standard
Standard wordings
- GDV AHB 2016 clause 7.5
Purpose
The relatives clause excludes liability claims arising from losses involving relatives of the policyholder who live with them in the same household or are co-insured under the policy. The precise circle of relatives covered by the exclusion is defined in the applicable policy wording.
Effect and limits
The exclusion is intended to prevent the risk of collusive conduct between the policyholder, co-insured persons, and the claimant. Where close family relationships exist, there is a heightened risk that a loss event could be manipulated, or a claim artificially constructed, at the insurer’s expense.
Negotiation and practice
Because the scope of “relatives” can vary considerably between policy wordings, families and shared households should carefully review the clause’s definition to identify potential coverage gaps for claims arising within the family. Some tariffs write back bodily injury and property damage claims between co-insured persons and limit the exclusion to financial loss.