I remember reading an article about the issues of over insuring and under insuring an aircraft.
If the plane was under insured, the insurance company would give you the value of the policy, fix the plane and resell it for a profit.
If the plane was over insured, they would pay to fix it versus giving you the value of the policy. Which may not be desirable either.
The best option, according to the article, is insure as close as possible to the value of the aircraft.
