Business, Legal & Accounting Glossary
Insurance (from two or more policies) that exceeds the value of the item being covered.
A situation where an insured party has bought so much coverage that it exceeds the actual cash value (or the replacement cost) of the risk or property insured. For the insurance company, overinsurance constitutes a moral hazard because the insured (overinsured) may be tempted to make a false claim to profit from a loss.
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This glossary post was last updated: 14th January, 2020