Property Insurance Concepts- Coinsurance

Property Insurance Concepts- Coinsurance

by Alicia Chavez -
Number of replies: 1

 

 

     Can you please somebody help me in the math questions I have problems in the property

    insurance  value I do not understand the formula for the end of the final resolution

In reply to Alicia Chavez

Re: Property Insurance Concepts- Coinsurance

by Jan Bradburn- -

Alicia,

There is a specific order of the operations for a coinsurance question.  You have to work coinsurance problems in this order:

1.            Value of property X coinsurance percentage

2.            Limit of insurance/answer from step #1

3.            Loss X answer from step #2

 

Basically, coinsurance requires a property owner to insure their property to full value.  If property is insured to less than full value, insurance will not pay the full loss. For example, if property is insured to 50% of its' value, insurance will pay 50% of the loss.  

I hope this helps.

Jan