Question

A godown valued at Rs.40000 contained stock worth Rs.240000 . They were insured against fire, the former to the extent of $Rs.25000$ and the latter for $80\%$ of its value. Fire broke out and stock worth $Rs.30000$ was completely destroyed while the rest was reduced to $60\%$ of its value. The damage to the go down amounted to $Rs.20000$ . What sum can be claimed under the policy?

Answer 1

Hint: At first, we find the loss incurred on the remaining stock which is \[\dfrac{40}{100}\times \left( 240000-30000 \right)=Rs.84000\] . After that we find the total loss on the stock which is $84000+30000=Rs.114000$ . Next, we calculate the claim on the stock which is \[80\%\text{of Total loss on stock}=\dfrac{80}{100}\times 114000=Rs.91200\] . After that, we find the claim on the go-down which is \[\dfrac{25000}{40000}\times 20000=Rs.12500\] . We then find out the total claim by adding the two claims.

Complete step by step solution:
In this problem, we are given some data regarding the policies and property value of the go down and the stock. The value that we are provided with are,
The property value of go down $=Rs.40000$
The property value of stock $=Rs.240000$
The policy value of go down $=Rs.25000$
Stock is insured for $80\%$ of the value of the property of the stock.
Now, we are told that the fire has completely destroyed the stock worth of $Rs.25000$ . So,
$\begin{align}
  & \Rightarrow \text{Value of remaining stock} =\left( \text{Property value of stock} \right)-\left( \text{Value of stock completely destroyed} \right) \\
 & \Rightarrow \text{Value of remaining stock}=240000-30000=Rs.210000 \\
\end{align}$
The value of the remaining stock is reduced to $60\%$ of its value. Thus, loss is to the extent of $40\%$ . So,
\[\begin{align}
  & \text{Loss on remaining stock}=\text{ }40\%\text{of its value} \\
 & \Rightarrow \text{Loss on remaining stock}=\dfrac{40}{100}\times 210000=Rs.84000 \\
\end{align}\]
We get,
\[\begin{align}
  & \text{Total Loss on stock}=\left( \text{Value of stock completely destroyed} \right)+\left( \text{Loss on remaining stock} \right) \\
 & \Rightarrow \text{Total Loss on stock}=30000+84000=Rs.114000 \\
\end{align}\]
We get the claim for the stock as,
\[\begin{align}
  & \Rightarrow \text{Claim for stock}=80\%\text{of Total loss on stock} \\
 & \Rightarrow \text{Claim for stock}=\dfrac{80}{100}\times 114000=Rs.91200 \\
\end{align}\]
The loss on go-down $=Rs.20000$
Then, we get,
\[\Rightarrow \text{Claim for go-down}=\dfrac{25000}{40000}\times 20000=Rs.12500\]
Thus, we can conclude that the sum that can be claimed under the policy is $91200+12500=Rs.103700$.

Note: The most important thing that we must be careful with is that the claim is always a proportional entity. Also, we should note that the remainder of the stock was reduced to $60\%$ and that the loss is not $60\%$ .