Question 99

Latisha can receive a maximum of $15,000 for the damage to her detached garage.

Under her Dwelling Form flood policy, Latisha's detached garage is covered up to a specific limit, which is typically a percentage of the overall dwelling coverage. In this case, the maximum she can receive for the damage to her detached garage is $15,000.

A) $150,000

This option incorrectly suggests that Latisha can receive the full amount of her dwelling coverage for the garage damage. However, flood policies typically have lower limits for detached structures, meaning the dwelling coverage amount does not apply to the garage directly.

B) $15,000

This option is correct because it reflects the standard maximum payout for detached garages under a Dwelling Form flood policy. Typically, policies allow for a capped amount for such structures, often set at 10% of the total dwelling coverage, which in this case would be $15,000.

C) $25,000

This option is incorrect as it implies that the entire amount of damage to the garage is covered. However, the policy limits the payout for detached structures regardless of the actual damage incurred, which is why Latisha cannot receive this full amount.

D) $0

This option is incorrect as it suggests there is no coverage for the detached garage under the policy. Since there is a specified amount covered, Latisha will receive a payout, albeit limited to $15,000.

Conclusion

Latisha's maximum payout for the damage to her detached garage is definitively $15,000, as indicated by her policy's coverage limits for detached structures. Other options fail because they either overstate the coverage based on dwelling limits or incorrectly assume no coverage exists at all. Thus, Option B accurately represents the conditions of her insurance policy.