Question

COMMERCIAL PROPERTY CPOS 00 10 00 COMMERCIAL PROPERTY COVERAGE PART DECLARATIONS PAGE POLICY NO. SP 0001 EFFECTIVE DATE 101 1 2019 "X" If Supplemental Declarations Is Attached NAMED INSURED Al's Suds and Duds DESCRIPTION OF PREMISES Prem. Bldg. No. No. Location, Construction and Occupancy 001 001 1234 College Drive College Town, USA COVERAGES PROVIDED Insurance at The Described Premises Applies Only for Coverages for Which a Limit of Insurance Is Shown Prem. Bldg. No. No. 001 001 Coverage Building Your Business Personal Property and Personal Property of Others Limit Covered Of Insurance Causes of Loss 250,000 Special 100,000 Broad Coinsurance Rates n/a _(See Sched.) n/a OPTIONAL COVERAGES Prem. Bldg. No. No. Building *If Extra Expense Coverage, Limits On Loss Payment Applicable Only When Entries Are Made In The Schedule Below Replacement Cost (X) Pers. Including Prop. "Stock" Commercial Property 001 001 X X Inflation Guard (%) Bldg. Pers. Prop. 5% 5% DESCRIPTION OF PREMISES Prem. Bldg. Mortgageholder Name and Mailing Address No. No. 001 001 Workingtown Savings and Loan Assn. 400 Main Street Workingtown, PA 19001 DEDUCTIBLE $0 Exceptions: n/a Endorsements Value Reporting Form: n/a CP DS 00 10 00 Copyright, Insurance Services Office, Inc, 2012 Page 1 of 1

Answer 1

5)Option C $50000

AL's experience $50000 loss to the building and insurer will pay the same amount i.e. $50000 as the insurance is taken for the building and loss occured in the building is $50000.

Material and supplies worth $12000 was stored 50 feet away from the Building which has been insured.Hence,$12000 will not be paid by the insurer company because the insurance is done for the loss in the building only with special case of $250000 and $100000 on the business personal property.

Therefore,Al's insurer will pay $50000 as it a special case for the building.

6)Option B $40000

The total amount paid for the new carpet installed throughout the building=$100000

Total expected life of the carpet=5 years

Total years for which the carpet was used=3 Years

Remaining expected time period for which the carpet to be used=total expected life(5)-total years for which carpet

used(3).

=5Years-3 years

=2 years

As per actual cash value basis,insurer will pay=Total value paid*Remaining number of years/total number of years

=$100000*2/5

=$40000

Hence,Insurance company will pay $ 40000 to the company for the loss occured to the carpet.