1. Thiru was offered a fire insurance with a cash value ofRM200000 with a 80%coinsurance clause. To save on the premium, he bought a RM12000 policy instead. A fire broke out and he incurred damages and losses amounting to a cash value of RM40000.

Estimate how much the insurance company would pay Thiru in case of a claim based on actual cash value.

2.Asset Property Sdn.Bhd, a reputable developer, has advertised for a double storey house costing RM500000. You have requested Frankie Hero International, a leading international real estate consultancy, to appraise the property and the valuation has been determined at RM505000. Thinking that it is a good buy, you have decided to approach ABC Bank for a loan which requires an 80% loan-to-value ratio.

Based on the above information, how much would you have to deposit as down-payment for this property?

3.With examples,explain the following terminologies (all 5 marks)

letter of last instructions

principle of utmost good faith

suicide clause

personal liability umbrella policy

revolving lines of credit

4. Describe 2 short-term investment vehicles that can be used to manage your cash resources.(5 m)

5. Discuss how all estate will be distributed in the absence of a will. (8m )