Find the amount paid by each insurance company. Assume that any coinsurance requirement is met.
-Insurance loss: $32,000
Company A coverage: $160,000
Company B coverage: $40,000

Question

Quizplus · Accepted Answer

The total coverage is $200,000 ($160,000 from Company A + $40,000 from Company B). Company A covers 80% ($160,000/$200,000) and Company B covers 20% ($40,000/$200,000) of any loss. Therefore, for a $32,000 loss, Company A pays 80% ($25,600) and Company B pays 20% ($6,400).

Find the Amount Paid by Each Insurance Company