Which of the following statements about problems arising from the use of a coinsurance clause is (are) true?
I. The amount of insurance should be periodically evaluated to avoid a coinsurance penalty because of inflation.
II. An agreed value coverage option is one method used to solve the problem of values that fluctuate throughout the policy term.
A) I only
B) II only
C) both I and II
D) neither I nor II
Answer: C
Business
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