Asked by raquel galvan on Jul 02, 2024
Verified
An insurance company has a standard coinsurance clause of 90%. Compute the amount of insurance coverage the owner of a building valued at $1,060,000 must carry in order to avoid being the bearer of part of the insurance.
Coinsurance Clause
A provision in an insurance policy that determines the percentage of the cost a policyholder is responsible for after the deductible is met.
Insurance Coverage
The amount and type of protection provided by an insurance policy against various risks or damages.
- Understand and apply the concept of coinsurance to determine the necessary amount of coverage to avoid underinsurance penalties.
Verified Answer
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Learning Objectives
- Understand and apply the concept of coinsurance to determine the necessary amount of coverage to avoid underinsurance penalties.