Florida Insurance Claims Adjuster License Practice Exam

Other property under the Valuation clause is valued at the lesser of what two values?

1. Market value or cost to repair

2. Actual replacement cost or cost to repair

3. Purchase price or actual replacement cost

4. None of the above

The correct answer is: Actual replacement cost or cost to repair

According to the Valuation clause, other property is valued at the lesser of two values actual replacement cost or cost to repair. This means that if the cost to repair the property is less than the actual replacement cost, that lower value will be used for valuation. It is not the market value or purchase price that is used for valuation, as these values may not accurately reflect the true cost of repair or replacement. Choosing option B, actual replacement cost and cost to repair, is the best option as it encompasses both potential values that may be relevant to the valuation of other property. Options A and C are incorrect as they only consider one of the two values, while option D is incorrect as it states that none of the options are correct when in fact option B is the correct answer.