Asked by Desiree Garza on May 25, 2024
Verified
The Jordan Company building was valued at $400,000. The building was insured for $200,000. The policy contained an 80% coinsurance clause. A fire caused $180,000 in damages. Compute the amount of the fire damage the Jordan Company had to pay.
Coinsurance Clause
A provision in insurance policies that requires the policyholder to bear a portion of the costs of a claim, serving to share risk between the insurer and insured.
- Acquire knowledge and apply coinsurance provisions to determine insurance payout amounts and the duties of policyholders post-claim.
- Examine the economic consequences of insuring assets at different valuations and comprehending policies regarding short-rate refunds.
Verified Answer
YM
Learning Objectives
- Acquire knowledge and apply coinsurance provisions to determine insurance payout amounts and the duties of policyholders post-claim.
- Examine the economic consequences of insuring assets at different valuations and comprehending policies regarding short-rate refunds.