The factor added to the net premium to cover the costs of the insurer in obtaining and maintaining the business is called:

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The factor added to the net premium to cover the costs of the insurer in obtaining and maintaining the business is called:

a. legal reserve
b. dividend accumulation
c. premium tax
d. expenses

Answer: d

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An insured's building has an actual cash value of $200,000, and he has insured the property for $120,000 with an 80% coinsurance clause. A $40,000 loss occurs. How much will the policy pay?

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