Finn and Rachel purchased a $200,000 homeowners policy for their house in 1988.

Question

Finn and Rachel purchased a $200,000 homeowners policy for their house in 1988. They have renewed the policy each year since and have replacement coverage. This policy has a $1,000 deductible. Their home now has a replacement value of $275,000. Last week they came home to find a small fire which caused the following damages:
Home$50,000
personal property$20,000
Landscaping$ 7,000
Assume Finn and Rachel have a standard HO-3 policy with personal property covered at 50% and landscaping covered for 10%. How much will the insurance pay for the losses of their personal property and landscaping?

Explanation / Answer

For personal property $20000

For landscaping $7000

And all the losses shall be paid by insurance

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