Answer to Question #328482 in Management for GRACA

Question

(a) Isaack buys a second-hand car from Reliable motors for R200 000. Isaack insures

the car for R200 000 with Amazing Insurance Company.

Advise Isaack as to the nature of the insurance contract that he has concluded with

Amazing Insurance Company. (7)

(b) Your motorcycle is valued at R250 000. You insure the motorcycle with C Insurers for

R250 000. You also decided to insure the motorcycle with D Insurers for R250 000.

While on a Sunday morning breakfast run you damage your motorcycle by hitting a

tree on the side of the road. The damage amounts to R250 000. Both insurers

indicate that they will rather compensate you instead of repairing the motorbike.

What amount of compensation can you claim from C Insurers and D Insurers? (10)