Given:
General liability insurance = $800
Business interruption insurnace = $1200
Property insurance = $500
Commercial auto insurance = $900
Let's answer the following questions.
(a) The total cost of Aurora's insurance if Aurora wants to buy a business insurance policy that protects her factory from damages resulting from fire, as well as any lawsuits filed by her customers.
• Here, the insurance type that protects her factory from fire is classified under the Property insurance which cost $500.
,
• The insurance type that protects the factory from any lawsuits filed by customers is classified under the general liability insurance which cost $800.
In this case, the total cost of her insurance will be:
Total = Cost of Property insurance + cost of general liability insurance
Total = $500 + $800 = $1300
In this case, the total cost of Aurora's insurance will be $1300.
(b) The total cost of Aurora's insurance assuming she wants to buy an insurance that covers all damages to vehicles at her factory and any losses incurred from the interruption of daily factory operations.
• Here, the insurance type that covers all damages to vehicles is classified under the ,commercial auto insurance ,which cost $900.
,
• The insurance type that covers any losses incurred from the interruption of daily factory operation is classified under the ,business interruption insurance ,which cost $1200.
In this case, the toatl cost of Aurora's insurance will be:
Total = cost of commercial auto insurance + cost of business interruption insurnace
Total = $900 + $1200 = $2100
In this case, the total cost of Aurora's insurance will be $2100.
ANSWER:
• (a) $1300
,
• (b) $2100