Renee is risk manager of XYZ Company. She purchased a Commercial Package Policy for her company and added one optional coverage.
This option suspends the coinsurance clause and substitutes a new agreement covering any loss in the same proportion that the limit of insurance purchased bears to a value specified in the declarations. This provision is known as
A) waiver of inventory coverage.
B) inflation guard coverage.
C) agreed value coverage.
D) replacement cost coverage.
Question 2
A commitment fee is
A) paid by investors to guarantee that a company will borrow from them.
B) an amount paid by an investment banker to ensure the sale of securities.
C) paid by bondholders to secure the right to convert bonds into common stock.
D) an amount paid on the unused portion of a loan in a private placement.
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