óverðtryggð

Overtrøggð is an Icelandic term that translates to "over-insured" or "excessive insurance." It refers to a situation where the sum insured on an asset or property exceeds its actual market value or replacement cost. This can occur for various reasons, including outdated appraisals, a decrease in the asset's value over time, or a deliberate overvaluation by the policyholder.

While it might seem beneficial to have a higher coverage amount, overtrøggð can create complications. In the event of a claim, the insurance company will typically only pay out the actual loss incurred, up to the sum insured. If the sum insured is significantly higher than the value, the policyholder may pay higher premiums than necessary without receiving a proportional increase in compensation. Furthermore, some insurance policies may have clauses that address overtrøggð, potentially limiting payouts or even voiding the policy under certain circumstances.

It is important for individuals and businesses to regularly review their insurance policies and ensure that the sum insured accurately reflects the current value of their assets. This helps to avoid paying for excessive coverage and ensures that claims are handled efficiently and fairly. Accurate valuation is key to effective insurance protection.