Last year, Eleanor and Felix Knight bought a home with a dwelling replacement value of $260,000 and insured it (via an HO-5 policy) for $221,000. The policy reimburses for actual cash value and has a $500 deductible, standard limits for coverage C items, and no scheduled property. Recently, burglars broke into the house and stole a 3-year-old television set with a current replacement value of $500 and an estimated useful life of 9 years. They also took jewelry valued at $1,550 and silver flatware valued at $3,300. If the Knights' policy has an 80% co-insurance clause, do they have enough insurance? Assuming a 50% coverage C limit, calculate how much the Knights would receive if they filed a claim for the stolen items. Do not round intermediate calculations. Round the answer to the nearest cent. What advice would you give the Knights about their homeowner's coverage?
Last year, Eleanor and Felix Knight bought a home with a dwelling replacement value of $260,000 and insured it (via an HO-5 policy) for $221,000. The policy reimburses for actual cash value and has a $500 deductible, standard limits for coverage C items, and no scheduled property. Recently, burglars broke into the house and stole a 3-year-old television set with a current replacement value of $500 and an estimated useful life of 9 years. They also took jewelry valued at $1,550 and silver flatware valued at $3,300.
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If the Knights' policy has an 80% co-insurance clause, do they have enough insurance?
Assuming a 50% coverage C limit, calculate how much the Knights would receive if they filed a claim for the stolen items. Do not round intermediate calculations. Round the answer to the nearest cent.
What advice would you give the Knights about their homeowner's coverage?
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