Jamil and Vicky Purchased a $200,000 Homeowners Policy for Their

Multiple Choice

Jamil and Vicky purchased a $200,000 homeowners policy for their house in 1988.They have renewed the policy each year since and have replacement coverage.This policy has a $1,000 deductible.Their home now has a replacement value of $275,000.Last week they came home to find a small fire which caused the following damages: How much will the insurance company pay for the $50,000 loss to their home?

A) $ 50,000 less the deductible
B) $ 45,000 less the deductible
C) $ 50,700 less the deductible
D) $200,000 less the deductible
E) none of the above