Wear and Tear, Inherent Vice, Deterioration, Etc.: The Multi-Faceted All-Risk Exclusions
![handle is hein.journals/ttip21 and id is 644 raw text is: WEAR AND TEAR, INHERENT VICE,
DETERIORATION, ETC.: THE MULTI-FACETED
ALL-RISK EXCLUSIONS
Andrew C. Hecker, Jr. and M. Jane Goode
All-risk policies are meant to cover all risks except those specifically excluded. That
concept, so easily stated, has created numerous fundamental coverage questions.
What is a risk? What is the meaning and/or intent of each exclusion? Who has the
burden of proving coverage? Who has the burden of establishing the scope or appli-
cability of exclusions?
Many of the above questions have been resolved by the parties prior to the render-
ing of judicial opinions, resulting in a paucity of reported judicial determinations in
this area. There are, however, some cases which provide guidance in solving the
problems which attend all-risk coverage. It is the purpose of this paper to discuss
those cases and the recent trends discernible therefrom.
All-risk insurance has been described as a promise to pay upon the fortuitous and
extraneous happening of loss or damage to a specified thing or person from any cause
whatsoever, except when occasioned by the willful or fraudulent acts of the insured.'
As its name and the above broadly-stated description imply, all-risk insurance pro-
vides coverage as to all risks except those which are specifically excluded by the terms
of the policy.2 The policy does not, however, provide coverage for all losses.' As origi-
1. 2 RICHARDS, INSURANCE, § 212 (5th ed. 1952).
2. Dow Chemical Co. v. Royal Indem. Co., 635 F.2d 379, 386 (5th Cir. 1981) (all-risk insurance
creates a special type of coverage that extends to all fortuitous losses not resulting from misconduct or
fraud unless the policy contains a specific provision expressly excluding the loss from coverage).
3. British & Foreign Marine Ins. Co. v. Gaunt, 2 A.C. 41 (1921); Avis v. Hartford Fire Ins. Co.,
283 N.C. 142, 195 S.E.2d 545 (1973). As the Avis court stated:
There are, of course, limits to all risks. They [sic] are risks and risks insured against. Accord-
ingly the expression does not cover inherent vice or mere wear and tear or British capture. It
Andrew C. Hecker, Jr., is a Partner, and M. Jane Goode is an Associate, of Hecker Rainer &
Brown, in Pbiladelpbia, Pennsylvania.](ViewImageLocal?handle=hein.journals/ttip21&div=44&collection=&method=preview&ext=.png&size=3)
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Wear and Tear, Inherent Vice, Deterioration, Etc.: The Multi-Faceted All-Risk Exclusions
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