Insurance 101 – Chapter 9 – Volume 58 – More Betterment

More Betterment

From this beginning, the California Supreme Court set in stone the definition of actual cash value in property insurance when it was asked to resolve a dispute arising out of a fire at a hotel owned by Fong Hong May. Fong had purchased a policy of fire insurance from Jefferson Insurance Company that provided him coverage against loss by fire pursuant to the Standard California Fire Policy. His policy contained, as a rider to the Standard policy an “average” or “coinsurance” clause. The average clause provided that Fong was required  to maintain, as a condition of his policy, insurance equal to 70% of the actual cash value of his hotel. Fong believed that his hotel, less the value of the land, was worth $65,000 and therefore insured it for $45,000, or approximately 70% of its estimated value.

The following video was adapted from my book, “Insurance Claims A Comprehensive Guide” Published by the National Underwriter Company and is available at the Zalma Insurance Claims Library

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The author and publisher disclaim any liability, loss, or risk incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this blog. The information provided is not a substitute for the advice of a competent insurance, legal, or other professional. The Information provided at this site should not be relied on as legal advice. Legal advice cannot be given without full consideration of all relevant information relating to an individual situation.

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