Question

Brendas Bakery, which is covered by a businessowners policy, sustains a fire loss of $50,000 to the building and $25,000 in content damages is incurred. In addition, a customer and an employee are insured in the fire. Medical payments for their injuries amount to $2,000 for the injured customer and $3,000 for the injured worker. Brenda's business income is $5,000 per month, but she is unable to conduct any business for 60 days as a result of the fire. Assuming Brenda has adequate limits to cover this loss, how much will her policy pay

Answer 1

$87,000

Step-by-step explanation:

Brenda's businessowners policy will cover:

• the damages to the building for $50,000
• the damages to the content of the building for $25,000
• lost business income for $5,000 x 2 months = $10,000
• the injuries suffered by the customer for $2,000
• total = $87,000

The injuries suffered by the employee must be covered by a separate workers' compensation policy.