TTK article 1462: The insurance amount must be in accordance with the real value of the insured goods.
Incomplete Insurance
- Insurance cost < real value
- Damage is paid proportionately
- Example: 100,000 TL worth of goods, 50,000 TL insured → 50% is paid
Exceeding Insurance
- Insurance cost > real value
- Compensation is paid only on the real value
- The premium of the excess part is refunded (if unknowingly)
- Knowingly excess insurance = insurance fraud
Duplicate Insurance
- More than one insurance for the same property
- Total compensation cannot exceed the actual value
- Insurers share proportionately
Supreme Court 11. HD
11. HD adopts that the "average rule" should be applied in underinsurance, and that proportional payment will be made in case of unintentional under-declaration of the insured.
Practical Recommendations
- Determine the insurance cost according to the real market value
- Follow the annual value increase
- Avoid double insurance
Insurance law lawyer is recommended.