Loss = ____.
Q.4 (A) (ii) Loss = ____.
A. Claim \(\times\frac{\text{Policy value}}{\text{Property value}}\)
B. Claim \(\times\frac{\text{Property value}}{\text{Policy value}}\)
C. Claim \(\times\) Property value
D. Claim \(\times\) Policy value
Q.4 (A) (ii) Loss = ____.
A. Claim \(\times\frac{\text{Policy value}}{\text{Property value}}\)
B. Claim \(\times\frac{\text{Property value}}{\text{Policy value}}\)
C. Claim \(\times\) Property value
D. Claim \(\times\) Policy value
Best answer
Answer: B. Claim \(\times\frac{\text{Property value}}{\text{Policy value}}\)
Answer: (b) Claim \(\times\frac{\text{Property value}}{\text{Policy value}}\)
Under the average clause, Claim \(=\frac{\text{Policy value}}{\text{Property value}}\times\text{Loss}\). Rearranging, Loss \(=\text{Claim}\times\frac{\text{Property value}}{\text{Policy value}}\).
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