(1) If the insured amount substantially exceeds the value of the subject matter insured, an insurer or policyholder may demand reduction of the premium and of the insured amount: Provided, That such reduction of the premium shall only be effective for the future.
(2) The value mentioned in paragraph (1) shall be determined by reference to the value when a contract is made. <Amended by Act No. 4470, Dec. 31, 1991>
(3) The provisions of paragraph (1) shall apply where the insurable value has substantially decreased during the period of coverage.
(4) In the case of paragraph (1), if the contract is concluded due to any fraud by the policyholder, such contract shall be null and void: Provided, That the insurer may demand the premium due until it becomes aware of such fact.