George and Nancy had a $30,000 repair bill on their house after the tornado went though town. Their policy contained the usual 80% co-insurance clause. Their home's replacement value was $150,000; their policy coverage was $110,000 with a $250 deductible.
- How much insurance should they have carried to meet the coinsurance obligation?
- What percentage of this loss will the insurance company pay?
- How much of the loss will George and Nancy have to absorb?