Underinsurance

(redirected from underinsure)
Also found in: Dictionary, Medical.

Underinsurance

The state in which one's health insurance or other insurance policy does not provide sufficient benefits. In an extreme example, one may be underinsured if one's policy does not cover cancer. Underinsurance may be deliberate: young persons often underinsure themselves because they are healthy and wish to pay lower premiums. However, some insurers have at times underinsured even those paying higher premiums to save on their own costs.
References in periodicals archive ?
The policyholder is required to purchase an amount of insurance equal to at least a certain percentage of the value of the insured property (usually 80 percent) or suffer a proportionate "penalty" to the extent he underinsures. To return to our two building owners, the owner of the $2 million building should be required to purchase at least $1.6 million in insurance.