| NAME | INSURED AMOUNT(₦) |
ACTUAL VALUE(₦) |
ACTUAL LOSS(₦) |
| Mr. P Mr. K Mr. R |
25,000 30,000 40,000 |
100,000 120,000 150,000 |
30,000 40,000 50,000 |
Use the table above to answer questions 27 and 28
If Mr. P takes a fire insurance policy with average clause, his compensation will be
The average clause means that if the insurer discovers that the sum insured on your policy is less than the actual value of your contents or the rebuild cost of your property, then they can reduce their payout to you when you claim.
Claim amount = (Actual loss × Insured amount) / Value of goods or property at the date of loss.
Mr. P = 30,000 x 25,000 ÷ (100,000)
750,000,000 ÷ 100,000 = 7,500
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