When the amount for which a subject matter is insured is more than its actual value, it is called _________.

Question

Question: When the amount for which a subject matter is insured is more than its actual value, it is called _________.

Options:

1.  Reinsurance
2.  Double insurance
3.  Over insurance
4.  None

Answer 1

3. Over insurance

When the amount for which a subject matter is insured is more than its actual value, it is called Over insurance.

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Explanation:

Over insurance is an insurance condition of excessive availability of coverage that it exceeds the actual cash value of the risk or property insured.

Over insurance becomes a risk for the insurance company because the insurers may be tempted to make a false claim of making a loss.