Simons Purchased a Home for $120,000,insuring It for $120,000 with Mutual

question 46

Multiple Choice

Simons purchased a home for $120,000,insuring it for $120,000 with Mutual Life.She later purchased a $60,000 policy from Equitable.The home was totally destroyed by fire while it still had a fair market value of $120,000 and the losses amounted to $30,000.Under these circumstances,which of the following statements is true?

• A)Simons can claim the damages only from Mutual Life as its policy amount is greater.
• B)She cannot claim insurance from either as policies with pro rata clauses cover only partial losses.
• C)Simons can recover $180,000-the total of both policies,as part of his insurance contract.
• D)Simons cannot claim more than $60,000 from Equitable.