Arkansas Insurance Adjuster Practice Exam

Question: 1 / 400

Mark's cargo coverage is written on a/an ________ basis.

valued

replacement cost

unvalued

Mark's cargo coverage is written in a C basis. This means that the amount of insurance in a policy is determined by the value of the goods at the time of loss or damage. Option A is incorrect because it is referring to a valued basis, which means that the insurance is written for a specific amount regardless of the actual value of the goods. Option B is incorrect because it refers to a replacement cost basis, which means that the insurance is based on the cost of replacing the goods with new items. Option D is incorrect because it represents an actual cash value basis, which means that the insurance is written for the depreciated value of the goods. Therefore, option C is the correct answer because it accurately describes the type of coverage that Mark has.

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actual cash value

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