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2 November, 15:39

An insured has a special form dwelling policy written for $100,000 on a dwelling. The dwelling's replacement cost is $115,000. Fire causes $75,000 in damage to the dwelling, $15,000 damage to a separate garage, and kills 10 trees valued at $600 each. How much will the policy pay for the trees? A. $5,000B. $10,000C. $60,000D. $75,000

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  1. 2 November, 19:06
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    B. $10,000

    Explanation:

    Amount insured = 100000.

    This is the maximum amount payable.

    So replacement cost which is higher can not be paid.

    payable damage

    = 75000 as damage due to fire +

    15000 as damage to a separate garage

    Total payable

    = 90000

    The rest of amount that is

    100000 - 90000

    = 10000 can be paid as damage for the trees.
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