Waiver Of Co-insurance

You might find this clause in a commercial business policy. It states that the co-insurance penalty will not be applied in a claim for a small amount.

An example of waiver of co-insurance is when the insured has not insured to the required co-insurance amount. An example would be losses that are less then 2% of the amount of insurance and less then $5,000.

If you can negotiate this with the insurance company then you might chose to share the risk and deliberately under insure. Be careful to look at various methods of risk management to help reduce the possibility of having a claim.