Even though homeowners are eligible for reimbursement on a full replacement-cost basis if they keep their homes insured for at least 80% of the amount that it would cost to build them today, _____ can cause the actual amount of coverage to fall below 80%.
A) the replacement cost
B) inflation
C) the insurance premium
D) deductibles
E) the land value

Question

Even though homeowners are eligible for reimbursement on a full replacement-cost basis if they keep their homes insured for at least 80% of the amount that it would cost to build them today, _____ can cause the actual amount of coverage to fall below 80%.
A) the replacement cost
B) inflation
C) the insurance premium
D) deductibles
E) the land value

Quizplus · Accepted Answer

Inflation can cause the actual cost to rebuild a home to increase over time, which may cause the coverage amount to fall below the required 80% threshold.

Even Though Homeowners Are Eligible for Reimbursement on a Full