B. Same situation as above except Joe financed the home sale to Jon. Jon paid Joe $50,000 down and was scheduled to make monthly payments for the remainder (contract for deed). The contract contained a clause that required Jon to insure the home and instruct the insurance company to name Joe as loss payee on the policy. As in the above case, Jon failed to insure the house. The house completely burned on October 4, 2008. 1. Would Joe be able to collect on his policy, what amount if any, and why? 2. If Jon had insured the home for $100,000 in a timely manner before the fire, how much, if any, would Joe's policy pay? 3. Under #2 above, how much, if any, would Jon's policy pay? C. Jim and Sara were married and owned a home together. When they received the renewal bill for their homeowner's insurance, they decided to check out other insurance companies to see if they could find lower cost coverage. They found less expensive coverage at Express Insurance, and purchased a policy to cover the home. Unknown to Jim and Sara, the renewal premium for the original policy was automatically taken out of their bank account on the renewal date pursuant to an authorization they had signed when the original policy was purchased. On July 15 the house was totally destroyed by a tornado. When the house was destroyed, the house was covered for $100,000 by both companies. (the value of the house was $100,000). 1. Which company, if any, will pay the claim and why? 2. Would the amount paid, if any, be different if the home was worth $200,000? B. Same situation as above except Joe financed the home sale to Jon. Jon paid Joe $50,000 down and was scheduled to make monthly payments for the remainder (contract for deed). The contract contained a clause that required Jon to insure the home and instruct the insurance company to name Joe as loss payee on the policy. As in the above case, Jon failed to insure the house. The house completely burned on October 4, 2008. 1. Would Joe be able to collect on his policy, what amount if any, and why? 2. If Jon had insured the home for $100,000 in a timely manner before the fire, how much, if any, would Joe's policy pay? 3. Under #2 above, how much, if any, would Jon's policy pay? C. Jim and Sara were married and owned a home together. When they received the renewal bill for their homeowner's insurance, they decided to check out other insurance companies to see if they could find lower cost coverage. They found less expensive coverage at Express Insurance, and purchased a policy to cover the home. Unknown to Jim and Sara, the renewal premium for the original policy was automatically taken out of their bank account on the renewal date pursuant to an authorization they had signed when the original policy was purchased. On July 15 the house was totally destroyed by a tornado. When the house was destroyed, the house was covered for $100,000 by both companies. (the value of the house was $100,000). 1. Which company, if any, will pay the claim and why? 2. Would the amount paid, if any, be different if the home was worth $200,000
