Final answer:
Arbitration is a method used to resolve insurance disputes between an insured party and an insurer, excluding the valuation of a loss. Coinsurance clauses dictate that both the policyholder and insurer pay a share of any losses. The Seventh Amendment guarantees a right to a jury trial in significant civil disputes unless waived by both parties.
Step-by-step explanation:
The settlement option you're referring to is likely arbitration. This process is used to resolve disagreements between an insured party and an insurance company when there is a dispute over the terms or conditions of an insurance policy, excluding disagreements about the valuation of a loss. In cases where the value of the loss is in question, typically another method such as appraisal is used. However, if the agreement includes a coinsurance clause, it means the policyholder and the insurance company share the cost of the loss according to a specified percentage laid out in the policy agreement.
Moreover, the Seventh Amendment emphasizes the right to a jury trial in civil disputes in the United States where the value in controversy exceeds a certain amount, ensuring that litigation over civil matters respects this constitutional right unless both parties waive it.