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Question
A shop is valued at ₹3,60,000 for 75% of its value. If the rate of premium is 0.9%, find the premium paid by the owner of the shop. Also, find the agents commission if the agent gets commission at 15% of the premium.
Solution
Given, Property value = ₹3,60,000,
Rate of premium = 0.9%
Since the shop is insured for 75% of its value,
∴ Policy Value = 75% of property value
∴ Policy value = `(75)/(100) xx3,60,000` = ₹2,70,000
Amount of Premium = 0.9% of policy value
= `(0.9)/(100) xx 2,70,000`
Also, agent's rate of commission is 15% of the Premium
∴ Agent's commission = `(15)/(100) xx 2,430` = ₹364.5
∴ Premium paid by owner of the shop is ₹2,430 and agent's commission is ₹364.5.
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