Final answer:
Insurers use the coinsurance method to determine the loss amount under a cargo policy, where the insured pays a percentage of the loss and the insurer pays the rest.
Step-by-step explanation:
Insurers use a method known as coinsurance to measure the amount of an insured's loss under a cargo policy. This approach includes a policyholder paying a set percentage of the loss, and the insurance company covers the remaining cost. This method aims to encourage the insured to not underinsure their goods and mitigates the moral hazard issue, which is the risk that an individual may act less cautiously when they are insured against a certain event. The valuation of the cargo, the causes of loss, and the terms of the policy are taken into account to calculate the exact amount the insurance company will pay for a loss.