Fritz has an open fire insurance policy on his home for a maximum liability of $60,000. The policy has a number of standard clauses, including the right of the insurer to restore or rebuild the property in lieu of a monetary payment, and it has a standard coinsurance clause. A fire in Fritz’s house virtually destroys a utility room and part of the kitchen. The fire was caused by the overheating of an electric water heater. The total damage to the property is $10,000.The property at the time of loss is valued at $100,000. Fritz files a proof-of-loss claim for $10,000. Discuss the insurer’s liability in this situation.