What is the maximum payout for Home Owner Coverage B when Coverage A has a $200,000 limit?

What is the maximum payout for Home Owner Coverage B when Coverage A has a $200,000 limit?

• A. $25,000
• B. $30,000
• C. $20,000
• D. $15,000

Answer: (C)

In homeowners insurance, Coverage B specifically pertains to other structures on the property, such as detached garages, sheds, or fences. The maximum payout for Coverage B is typically set at a percentage of the Coverage A limit, which is the limit for the dwelling itself. Commonly, Coverage B is set at 10% of the Coverage A limit. In this scenario, with Coverage A having a limit of $200,000, the calculation for Coverage B would be as follows: 10% of $200,000 equals $20,000. This establishes the maximum payout for Coverage B in this context. Thus, the correct answer reflects this standard calculation, aligning with typical homeowners insurance policy structures.

In homeowners insurance, Coverage B specifically pertains to other structures on the property, such as detached garages, sheds, or fences. The maximum payout for Coverage B is typically set at a percentage of the Coverage A limit, which is the limit for the dwelling itself. Commonly, Coverage B is set at 10% of the Coverage A limit.

In this scenario, with Coverage A having a limit of $200,000, the calculation for Coverage B would be as follows: 10% of $200,000 equals $20,000. This establishes the maximum payout for Coverage B in this context.

Thus, the correct answer reflects this standard calculation, aligning with typical homeowners insurance policy structures.