The fire insurance policy on a $240,000.00 office building contains an 80% coinsurance clause. If the office is covered by a $200,000.00 policy, how much settlement would be paid after a $17,000.00 fire?Select one:a. $17,000.00b. $13,600.00c. $16,320.00d. $16,000.00

Accepted Solution

Answer:$17,000.00Step-by-step explanation:The value of the property is $240,000.00 with an 80% Coinsurance Clause, which means that the property should be inssured for $240,000*0.8=$192,000.00.The office building is insured for $200,000 wich is greater than the amount of money it should have been inssured for. If a loss of $17,000.00 occurs, then all $17,000.00 will be paid.