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Question
Fill in the blank :
The proportion of property value to insured value is called __________.
Solution
The proportion of property value to insured value is called policy value.
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Property value = ₹ 12,50,000
Rate of premium, r = ₹ 3%
If property is fully insured, the policy value is same as property value therefore policy value = `square`
Premium = `"r"/100 xx "policy value"`
= `square/100 xx 12,50,000`
= `square`
