Solve the problem using the table below. In addition, options can be added to th

Question

Solve the problem using the table below.

In addition, options can be added to the base coverage including the following: identity theft/fraud protection-$20/year; sewer/sump pump backup protection-$75/year. Extended coverage endorsements beyond the maximum coverage amounts can also be added for specific personal property. Endorsements can be added for: jewelry, watches, and furs-$0.85/$100/year; camera equipment-$1.35/$100/year;computer equipment-$0.95/$100/year; fine art and collectibles-$1.10/$100/year; firearms and accessories-$1.45/ $100/year; and portable tools-$3.25/$100/year.


A home with a replacement value of $343,000 is insured in a policy that contains an 80% coinsurance clause. The face value of the policy is $240,000 If a fire causes damage valued at $2000 find the amount of compensation to the owner by the insurance company.

$1600
$2000
$2286
$1749

Explanation / Answer

The insurance clause states 80% of total damaged value should be covered.

Total value of damage = $2,000

Total compensation = $2,000 × 80%

= $1,600

amount of compensation to the owner by the insurance company is $1,600.

Option (A) is correct answer.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.