Three companies insure Josh’s $2,500,000 factory building. Insurer A has it insured for 10%, insurer B for 35%, and insurer C for 55% of the replacement value. Using the contribution by equal shares provision for multiple insurance providers, how much will each insurer pay for a loss of $1,200,000? How much will each insurer pay? Insurer A would pay [A], Insurer B would pay [B], Insurer C would also pay [C]. 

If policy conditions are not met, the insurer can refuse to pay the claim. This provision in the policy is called __________.

An individual’s personal estimate of the chance of loss is a(n):  

A risk manager is concerned with which of the following? Identifying potential losses Selecting the appropriate techniques for treating loss exposures  

The Smiths and the Johnsons both have the exact same amount of damage ($15,000) to their roof. Each family also has a $1,000 deductible. The Smiths have an RCV policy, meaning once the roof is replaced, they will be reimbursed the full cost of the roof repair, minus their deductible. The Johnsons have an ACV policy, meaning they will only be paid for the current value of the roof repairs, minus depreciation and their deductible.  Based on the scenario above, how much will each family receive from their insurance company?  Family  Damage  Depreciation  Deductible  Payment  Smith Family  $15,000  – n/a  – $1,000  = [1] Johnson Family  $15,000  – $10,000  – $1,000  = [2]

To be legally enforceable, an insurance contract must meet which four requirements?  

There are numerous benefits of implementing an ERM program: (Select all that applies)

Five Below Zero is a new ski resort in Colorado. Five Below Zero is concerned that an abnormally warm winter will prevent the accumulation of snow needed to have a profitable ski season. Five Below Zero purchased a contract that will pay a lump sum if the daily high temperature exceeds 30 degrees for more than 12 days between January 1st and March 31st. The contract Five Below Zero purchased is called a(n):

Fundamental purposes of the principle of indemnity include which of the following? (select all that applies)

Under contribution by equal shares, each insurer shares equally in the loss until the share paid by each insurer equals the highest limit of liability under any policy, or until the full amount of the loss is paid.