Halbrooke Warehouse Inc. recently incurred $263,000 in damages from an earthquake. Fireman's is responsible for $47,500 out of a total of $475,000 coverage provided by multiple carriers. If all coinsurance requirements have been met, how much of the loss will be paid by Fireman's?

Question

Quizplus · Accepted Answer

Fireman's share of the coverage is $47,500 out of a total coverage of $475,000, which is 10% of the total coverage. Therefore, Fireman's will pay 10% of the damages incurred, which is 10% of $263,000, equaling $26,300.