Underinsurance occurs when policyholders insure their assets for less than their actual value, which can result in reduced claims payouts when losses occur. This situation is often caused by factors like a lack of awareness, misunderstanding of insurance policies, or financial constraints. In this article, we explore the risks associated with underinsurance and why it is essential for policyholders to ensure their coverage reflects the true value of their assets.

When underinsurance is identified, insurers apply the principle of average, which reduces the payout proportionally to the level of underinsurance. This can lead to significant financial strain, limited recovery, and even personal responsibility for legal claims in cases of underinsured liability coverage. Understanding these consequences is vital for avoiding the potentially devastating impact of underinsurance.

Coronation Insurance takes a proactive approach to address underinsurance by educating clients, offering tailored insurance solutions, and ensuring continuous engagement. In our article, we discuss how Coronation’s strategies, including personalized assessments and regular client communication, help prevent underinsurance and provide clients with comprehensive protection. To learn more about how Coronation is protecting policyholders from the risks of underinsurance, read the full article.

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