Asked by Rhetori Thompson on Apr 23, 2024
Verified
The Jordan Appliance Company has two buildings. Building A is valued at $95,000 and is covered by a $60,000 insurance policy with an 80% coinsurance clause. Building B is also valued at $95,000 and is covered by a $50,000 insurance policy with a 75% coinsurance clause. Both buildings burned to the ground. Compute the amount of insurance money Jordan Appliance Company collected altogether for fire damages.
Coinsurance Clause
A provision in insurance policies requiring the policyholder to bear a portion of the costs of a claim, promoting shared risk.
Fire Damages
Destruction or damage inflicted to property, goods, or assets due to fire.
Insurance Money
Funds received from an insurance company either as a claim settlement or benefit payment.
- Analyze and compute coinsurance clauses and their impact on claims in property and casualty insurance.
Verified Answer
ZK
Learning Objectives
- Analyze and compute coinsurance clauses and their impact on claims in property and casualty insurance.