Find the amount paid by each of the multiple carriers.
-The Hamilton Race Track had a fire loss of $207,000. They had insurance as follows: company A, $400,000; company B, $50,000; and company C, $50,000. Find the amount paid by each carrier. Assume the coinsurance requirement is met.

Question

Quizplus · Accepted Answer

To find out the amount paid by each carrier, we need to use the coinsurance formula: 
Amount paid by the insurance carrier = (Insurance carried by the carrier / Total insurance carried) X Amount of Loss

Using this formula, we can calculate:
- Amount paid by company A = (400,000 / 500,000) X 207,000 = $165,600
- Amount paid by company B = (50,000 / 500,000) X 207,000 = $20,700
- Amount paid by company C = (50,000 / 500,000) X 207,000 = $20,700

Therefore, the best choice is C as it provides the correct amounts paid by each carrier using the coinsurance formula.

Find the Amount Paid by Each of the Multiple Carriers