Showplace insures its $160,000 building with two insurers: with Hometown Insurance for $60,000 and with National Insurance for $120,000. The building suffers a fire loss of $75,000. From whom and for how much can Showplace collect?

Recovery under property insurance policies typically is limited by "other insurance clauses," which generally require that liability be distributed pro rata among the various insurers. Showplace insured its building for a total of $180,000, and can collect one-third of the loss ($60,000/$180,000) or $25,000 from Hometown Insurance. Two-thirds of the loss, or $50,000 could be recovered from National since coverage with National was two-thirds of the total insurance coverage purchased ($120,000/$180,000).