business HW

BUS-121 Spring 2017 Due: 05/01/17 Home and Automobile Insurance Name: Instructor: Frank Caperino Assignment Sheet Please show all work! 1) Your homeowner’s policy has a $500 deductible. If a tree branch falls on your roof causing $2,800 worth of damage, how

much would you receive from the insurance company? 2) Your homeowner’s policy has replacement coverage for personal property. However, they will only cover the first $1,500

for jewelry and $2,500 for guns and cameras. Ignoring any deductible, if a $2,000 engagement ring,$3,500 worth of camera equipment, and a $1,000 bicycle were stolen from your home, how much would the insurance pay to you? (Hints: Does replacement coverage pay for the replacement of an item? If the coverage for an item is not specifically excluded, then it is fully covered.)

3) Ann Chovey has a homeowner’s policy with actual cash value coverage for personal property. Her four-year-old genuine

imitation leather naugahyde sofa was ruined by an infestation of mice. It would cost $5,000 to replace the sofa. The sofa had an estimated life span of ten years. Ignoring any deductible, how much would the insurance pay Ann for her sofa? (Hints: Does actual cash value coverage pay for the replacement of an item? How much per year is $5,000 over ten years?)

4) There was a terrible accident in the home of Diana Thirst. The individual was awarded a judgment of $350,000. Diana’s homeowner’s policy has a maximum limit of $300,000 of personal liability. Ignoring any deductible, how much would Diana be held responsible for after the insurance company pays their portion of the award? If Diana had a personal catastrophe policy (a.k.a. an umbrella policy) with a limit of $1,000,000, how much would Diana need to pay?

5) Robin D. Cradle was judged at fault in an accident. The three occupants of the vehicle she hit were awarded damages of

$60,000, $20,000, and $5,000. Robin has 50/100/25 liability coverage. What amount, if any, would not be covered by her insurance and would be expected to be paid by Robin? (Hint: Careful! Make sure you look at all appropriate liability limits!)

6) Manny Haddett-Cumming was judged at fault in an accident. The three occupants of the vehicle he hit were awarded damages

of $160,000, $40,000, and $25,000. Manny has 100/250/50 liability coverage. What amount, if any, would not be covered by his insurance and would be expected to be paid by Manny? (See hint for question #5.)

7) Annie Body was judged at fault in an accident. The four occupants of the vehicle she hit were awarded damages of $15,000,

$10,000, $10,000, and $5,000. Annie has 15/30/5 liability coverage. What amount, if any, would not be covered by her insurance and would be expected to be paid by Annie? (See hint for question #5.)

8) Mya Pinion was judged at fault in an accident. She caused $35,000 worth of damage to someone’s home. Mya has 50/100/25

liability coverage. What amount, if any, would not be covered by her insurance and would be expected to be paid by Mya? 9) Find out and report the limits on your automobile insurance policy (Increase them if appropriate!)