Question

The insured purchased a $200,000 extra expense policy. If the percentages applying to the limit of insurance are 40%, 80%, and 100%, what would be the maximum payable for a 47-day loss?

1) $80,000
2) $120,000
3) $160,000
4) $200,000

Answer 1

The maximum payable for a 47-day loss on a $200,000 extra expense policy with percentages of 40%, 80%, and 100% would be $200,000.

Step-by-step explanation:

The insured purchased a $200,000 extra expense policy, which means that the maximum payable amount is $200,000.

The percentages applying to the limit of insurance are 40%, 80%, and 100%.

In this case, since the insured purchased a $200,000 policy, the maximum payable for a 47-day loss would be $200,000 since it is the full limit of insurance.