1: Marisa has a policy with replacement cost coverage and 80% co-insurance, and has a loss of $100,000 on her house. The replacement cost is $400,000 and the total policy coverage is $300,000. Since the loss is less than the coverage, she expects to get the full amount of the claim paid by the insurance company. Is she correct? Why? How much will the insurance company reimburse her for?

2: MacKenzie has a personal automobile policy with coverage of $25,000/$50,000/$10,000, $5,000 for medical payments and $250 deductible for collision insurance. How much will her insurance reimburse in each of the following conditions? Will she have any out-of-pocket expenses? (Show your work).

a) MacKenzie runs a red light and collides with another car resulting in the following losses:
-replacement of trailer hitch: $200
-replacement of rear bumper: $150
-replacement of computer being carried in back seat: $300
-replacement of rear windshield: $100

b) Driving home from work in a snowstorm, MacKenzie's husband, Bill, who was driving MacKenzie's car, hit a Mercedes, slid into a guardrail, and knocked down a telephone pole. Damages to the Mercedes, the guardrail, and the telephone pole were $8,500, $2,000, and $4,500, respectively.

c) MacKenzie was in an accident where she was found to be at fault. Four passengers were badly injured and were awarded $15,000 each because of her negligence.