Underinsurance

Sum insured lower than the actual value.

Underinsurance exists when the sum insured is lower than the actual value of the insured property. In that case the insurer reduces the benefit in the same proportion, even for a partial loss. A correct valuation prevents this.

The relevant statutes

§ 75 VVG

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Related terms

Sum Insured
Insured Event

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General explanation for self-help, not legal advice (RDG). Individual cases may differ: if in doubt, contact a consumer advice center or a lawyer.