A sewing machine valued at $20 000 was insured for $15 000 against theft. The machine was later stolen. Under the principle of average, what amount of compensation did the owner receive?

Model answer

$15 000

Also accepted: 15000, $15000, 15 000

Explanation

The machine was under-insured, but the sum insured ($15 000) was less than the value, so compensation was capped at the $15 000 sum insured.

Derived from ZIMSEC Commerce 7103/2 Paper 2, June 2004, Q9

Get the full paper, not just one question

Danho has every sitting for this paper, with your progress tracked question by question, offline.