Insurance companies

[Apoc]

It's different because you effectively artifically create value by over insuring

As long as you are paying the increase premium for the increased value (whether real, perceived or artificial) are there any risks/implications from that?

Yes... because you can insure a car for 10k for a year and then say it was stolen and get paid 10k when in reality it was only worth 2k. Overinsuring is one of the most common types of insurance fraud so companies require that you prove you're out that specific amount to prevent you from just jacking up the replacement cost. They want to know your loss of asset is similar to their liability so you won't falsely claim loss to make money. Their rates are based on the statistical "break even" for your vehicle and if you're incentivized to claim false loss their model is out the window.

Kaan really should consider double-checking his policy about the details. He could be paying that premium for nothing because there's a decent chance they won't just cut him a check without receipts.

I was a financial analyst for Allstate... ask me how I know.