declare @StateExclusionPlanTypes table(PolicyTypeId int, ExclusionID int)
insert into @StateExclusionPlanTypes(PolicyTypeId, ExclusionID) values
	(1, 42), (1, 43), (2,43)
declare @PolicyTypes table(PolicyTypeID int, PolicyTypeDesc varchar(50))
insert into @PolicyTypes(PolicyTypeID, PolicyTypeDesc) values
	(1, 'one'), (2, 'two')


select distinct(sept.ExclusionID), (
	select pt.PolicyTypeDesc+ ': '
	from @PolicyTypes pt
	join @StateExclusionPlanTypes sept1
	  on sept1.PolicyTypeID=pt.PolicyTypeID
	  and sept1.ExclusionID = sept.ExclusionID
	for xml path(''))
from @StateExclusionPlanTypes sept