risk and insuranse probleam 4

QUESTION

The ABC Company had crime coverage in the amount of $5,000. Following a covered crime loss of $10,000. the insurance company recovered $8,000. Describe how the recovered amount would be distributed between the parties involved.
ABCs Crime Insurance= $5000 Actual Loss : $10000 Amt Recovered : $8000 1. Required amount of insurance : $5,000 2. Policy limit : $5,000 3. Item 2 divided by item 1 : 1 ($5,000 divided by $5,000) 4. Actual loss amount : $10,000 $8000 = $2000 5. Penalty

tor : 1 (as determined in step 3) 6. Amount that can be paid : $2000 ($2,000 multiplied by 1) So ABC will get $2000 from Insurance in additionto $8000 recovered by Insurane

ANSWER:

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