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Assume you run a business on the Florida Gulf Coast, where hurricane damage can be extensive. The business owns a warehouse currently valued at $120,000.
Assume you run a business on the Florida Gulf Coast, where hurricane damage can be extensive. The business owns a warehouse currently valued at $120,000. You insured the warehouse for $80,000, which was your purchase price four years ago. The policy has an 80% co-insurance provision.
a. If you had a total loss, what reimbursement would you receive from your insurer? (Please show your work)
b. What if you had a loss of $10,000? (Assume an 80 percent coinsurance provision. (Please show your work)
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