The insurance carrier used by Best Security Systems specifies 75% coinsurance. The company recently incurred $696,000 in damages from a tornado. The building was valued at $877,000, but was only insured for $606,000. What amount will be paid by the insurance company for the loss? (Round your answer to the nearest cent)

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Quizplus · Accepted Answer

The insurance company will pay $641,240.59 for the loss. This is because the company was only insured for $606,000, which is less than 75% of the building's value of $877,000. Therefore, the company will only receive 75% of the $696,000 in damages, which is $641,240.59.

The Insurance Carrier Used by Best Security Systems Specifies 75