2. The basic principles of property insurance What are the basic principles of property insurance? There are two major types of insurance that protect your real and personal property, and that of others: property insurance and liability insurance As several of the principles on which property and ability insurance are based differ from those underlying Me and health insurance, it is important that you be aware of these differences so that you can structure your coverage and respond to a claim appropriately The purpose of property insurance is to protect policyholders against tosses to the catastrophe and calamity and due to These contracts require policyholders to identity and describe the property that is covered and to specify the contes of loss, called which a policyholder will be compensated in the event of loss However, instead of protecting against every possible cause of foss, property insurance policies gemerally restrict their protection to carefully specified causes of foss and specifically exclude causes that the insurance companies don't wish or can't afford to cover, Which of the following are typical causes of loss that are usually limited or excluded from most homeowner's or automobile insurance policies? Check all the apply. Vandalism WM Nuclear radiation Mysterious disappearance Assignment Chapter 10 Protecting Your Property Property insurance policies are based on the principle of which maintains that an insured his or her original financial condition as the result of a loss. This means that a policyholder cannot expect to receive insurance company than be enriched beyond in compensation from the As a result of this principle, property insurance policies often limit their reimbursement to the cash value of the damaged or destroyed property, which is calculated by subtracting the value of the item's depreciation from its current cost. This depreciation is usually the result of Daniel's Story : Actual Cash Value vs. Replacement Cost Coverage Daniel owns a house in and last week suffered some damage to his house. Specifically, a portion of his home was damaged by a lightening strike and the damage to the structure and his personal property is expected to have a replacement cost of $4,000. The same tems, which had an original cost of $2,400 when he bought them four years ago, had an estimated stule of ten years After calling bis insurance agent, Daniel was reminded that he cares full insurance on, or 80% of the replacement cost value of the house. However to save $60 per year in his premium, he'd only covered his possessions for their actual cash value. Given this information, Daniel can expect to receive only in compensation for his loss. In contrast, if he had cried replacement cost, instead of actual cash, coverage, then he would have received Property insurance companies retain several rights and can impose several requirements on its policyholders. Among them are After it has paid a daim, the right of the to request reimbursement from either the person who caused the loss or that person's insurance company. This is called the right of The requirement of which policyholder to buy insurance in an amount equal to a specified percentage of the of the property The clause, which states that if a person has more than one insurance policy, then each company is liable for amount of the loss based on its proportion of the total insurance covering the property Julien's two insurance policies Julien owns a house in Winchester and comes two insurance polices on it. The first policy carries a policy limit of $125,000; the second carries a limit of $95,000 Given a covered loss of $6,000, the first policy will pay a maximum amount of and the second policy will pay a maximum of Grade It Now Save & Continue Continue without saving