Mr Xavier Has an HO-3 Contract with $100,000 Dwelling Coverage

question 24

Multiple Choice

Mr. Xavier has an HO-3 contract with $100,000 dwelling coverage, $50,000 personal property coverage, and a $500 deductible. The dwelling is 50% depreciated. Sewage backs up into the basement and destroys the furnace, which will cost $8,000 to replace. The policy will pay:

• A) nothing because of the water damage exclusion
• B) nothing because the property is not covered
• C) $7,500 because of replacement cost coverage
• D) $3,500 because of actual cash value and the deductible

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Definitions:

Realistic Self-concepts

An individual's accurate and factual perception and understanding of their strengths, weaknesses, and character.

Taylor and Brown

Researchers known for their work in psychology, particularly on the positive illusions that people hold about themselves, their control over events, and their future.

Constructive Coping

Adaptive strategies for managing stress and solving problems, focusing on positive actions and cognitive approaches to mitigate stressful situations.

Careful and Consistent Research

The meticulous and steady collection, analysis, and interpretation of data to ensure reliability and validity in studies.