A condition in which the insurable value of property or possessions exceeds that of the coverage carried by a policyholder
1. Failure to maintain adequate coverage for a specific loss or damage. 2. Failure to meet a COINSURANCE requirement
this describes the case of a property being insured for less than its proper cost of rebuilding where the maximum possible loss will not be covered.
Under insurance occurs when the sum insured under an insurance policy is not sufficient to cover a total loss claim. Evidence of under insurance is normally only spotted at the time of a loss by a loss adjuster acting on behalf of an insurance company. If the amount of under insurance is severe, the insurance company may decide to apply an average clause which will reduce the amount of any claim in direct proportion to the amount of any under insurance.
A term used to refer to an occurrence of not having enough insurance to cover the value of that insured.
Insurance which would provide insufficient proceeds to compensate for the loss of the value of the insured item.
Sometimes the defendant's insurance policy is not enough to cover your claim. If your own “third party liability limits” are more than the defendant's, you may be able to claim the excess against your own insurer.
Occurs where the sum insured is less than the correct cost/value of rebuilding or replacing the property insured.
Insurance which is insufficient in amount to cover a loss which the policyholder may suffer.
Refers to either the failure to purchase adequate insurance limits or the failure to meet a coinsurance requirement.
(Sous-assurance or Assurance insuffisante) A situation in which insurance is less than the full value of the property insured. It becomes important with respect to co-insurance clauses where the insured is required to carry insurance to a certain proportion of the cash values.
Insurance coverage for an amount less than the value of the property being insured.
The result of the policyholder's failure to buy sufficient insurance. An underinsured policyholder may only receive part of the cost of replacing or repairing damaged items covered in the policy.
A condition in which not enough insurance is carried to cover the insurable value.
