Last year, Jose and Josefina Munoz bought a home with a dwelling replacement value of $250,000 and insured it (via an HO-5 policy) for $225,000. The policy reimburses 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 new computer with a current replacement value of $1,500 and an estimated useful life of three years. They also took jewelry valued at $2,500 and a coin collection valued at $1,500. If the Munozs’ policy has a 90 percent co-insurance clause, do they have enough insurance? Assuming a 50 percent coverage C limit, calculate how much the Munoz family would receive if they filed a claim for the stolen items. What advice would you give the Munoz family about their homeowner’s coverage?

Last year, Jose and Josefina Munoz bought a home with a dwelling replacement value of $250,000 and insured it (via an HO-5 policy) for $225,000. The policy reimburses 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 new computer with a current replacement value of $1,500 and an estimated useful life of three years. They also took jewelry valued at $2,500 and a coin collection valued at $1,500. If the Munozs’ policy has a 90 percent co-insurance clause, do they have enough insurance? Assuming a 50 percent coverage C limit, calculate how much the Munoz family would receive if they filed a claim for the stolen items. What advice would you give the Munoz family about their homeowner’s coverage?

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter7: Deductions And Losses: Certain Business Expenses And Losses

Section: Chapter Questions

Problem 22CE

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