A Building Owned by X Company Is Insured for $100

question 31

Multiple Choice

A building owned by X Company is insured for $100 000,but the insurance contract contains an 80 percent co-insurance clause.The building is damaged by fire to the amount of $20 000.The depreciated replacement value of the insured property is $250 000.The insurance company will then pay

• A)$8000.
• B)$15 000.
• C)$5000.
• D)$10 000.
• E)$20 000.

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Definitions:

Underwriter

An individual or organization that evaluates and assumes another's risk for a fee, such as with insurance policies or issuing of securities.

NASDAQ System

An electronic system and marketplace for buying and selling securities, particularly known for its high concentration of technology companies.

Investment Bankers

Professionals who specialize in raising capital for companies, governments, and other entities by underwriting or acting as the agent in the issuance of securities.

Initial Public Offerings (IPOs)

The process by which a private company goes public by selling its shares to the general public for the first time.