Edit: I am not advising anyone to deliberately do stupid things, simply mentioning that from my experience the builtin margin is fairly large.
A voltage drop of 25% could also mean you have semi-broken wiring somewhere, which can cause fires or shock hazards on faulty appliances.
"You must take steps to maintain the Home in a good state of repair and take all reasonable precautions to avoid loss, damage or injury and to safeguard all property insured from loss or damage."
These things are pretty standard - I would be very surprised if there isn't a similar clause in all of them.
Which implies that, if you fail to do so, they don't have to pay up.
The wording in your policy may be different. What are "reasonable steps" will depend on legal precedent. It may, for example, take into account that you're not an expert, and will probably include some reasonable time to get stuff fixed. But certainly it provides them the opportunity to deny a claim.
Obligatory disclaimer: I am not a lawyer or insurance expert, get your own advice if you need it.
For completeness, the relevant section from my policy is "We will not pay for any loss to the property...as a result of...Neglect, meaning neglect of the insured to use all reasonable means to save and preserve the property at and after the time of a loss, or when property is endangered". But in the same context, it says "However, we will pay for any resulting loss from ... defect, weakness, inadequacy, fault, or unsoundness in ... design, specifications, workmanship, repair, construction, renovation, remodeling, grading or compaction; [or] maintenance."
It would be shaped by the legal precedent in interpreting these sorts of clauses, and perhaps also the whims of a jury. It still seems unlikely to me that either of our policies would end up excluding the electrical anomaly, and moreover I've yet to ever hear a verifiyable account of someone whose homeowners insurance claim was denied after an electrical problem in their house led to a loss.
That's not to say that the original electrical fault wouldn't be insured - that depends on other terms.
Your policy does seem to be more lenient than mine in that it allows "resulting loss from " ... "inadequacy or unsoundness in" ... "maintenance". I wonder what the scope of that is in reality.
But, generally, policies require you to maintain the property.
You're understanding is correct, if neutral is allowed to float it's voltage will depend on ratio of the load on the 2 phases.
It also creates a variety of hazardous conditions and opportunities to make spicy metal.
You can play with it here courtesy of Paul Falstad and Iain Sharp: https://tinyurl.com/yq4lukm6
The point is that in electricity delivery, it is normal to have deviations in the voltage as acceptable. Most power supplies have tolerances that can handle these deviations. A dip is something outside of the deviations that most people don't consider as they are only focused on spikes and only use surge suppression devices. Since the only protection from dips is a more expensive battery solution, most people do not bother outside of computer related usages.
one of the shops that I worked at suffered a catastrophic situation when a nearby construction crew cut one phase of the 3-phase power coming into our facility. the poor transformer died, and took out the some of the more delicate PSUs attached to some very expensive equipment. we were down for weeks recovering from that.
For AC motors, the lower voltage might mean they do not have enough power to turn, so all the power they consume becomes heat in the motor windings (and since they're not turning, there's less cooling).
For electronic power supplies, they might either pull more current to maintain the same output (again leading to more heating), might output a lower voltage (and DC-DC converters which consume that voltage might in turn draw more current, again leading to more heating), or they might even misbehave and output an oscillating voltage; they might also detect the power dip and shut down, only to power up again moments later, repeatedly.
A device in an idle stand-by mode is probably the best case, since it's using little power from a supply sized for a much bigger load.
I disagree with the sibling comment that the only protection from voltage dips is a UPS or similar; a simpler protection is an undervoltage relay with a timer, to convert the voltage dip into a power outage (and also prevent the power from being restored too quickly).
Sure, if the manufacturer wants to increase the cost on the BOM for their PSUs, they can use additional components to survive dips, but who does that on disposable electronic equipment? Hell, even "expensive" TVs don't. I quote expensive since you can now get 65" 4K TVs cheaper than a mobile phone, but that's a tangent. So if you are wanting to protect your electronic equipment with another device readily available that is just plug an play ease of use with no knowledge of electronics, what do you suggest?
adding something to the power panel is not something a consumer can do. how is this even being confused?
260V is in +/- 10% threshold and is possibly falls within "engineered in tolerance" range, but will probably shorten the life of many appliances if supplied constantly.
Paradoxically, it may be the lower voltages that are more dangerous, because it will result in a higher current draw from all the devices.
Mains voltage has a nontrivial allowed range (in fact in Europe they increased it slightly so that devices would work across countries with slightly different original standards) but this is well out of spec.
An RMS voltage of 230V corresponds with a peak voltage of ~325V so reading of 260V could theoretically happen.
But 170V... yikes!