Arkansas Insurance Adjuster Practice Exam

Mark's cargo coverage is written on a/an ________ basis.

1. valued

2. replacement cost

3. unvalued

4. actual cash value

The correct answer is: unvalued

Mark's cargo coverage is written in a C basis. This means that the amount of insurance in a policy is determined by the value of the goods at the time of loss or damage. Option A is incorrect because it is referring to a valued basis, which means that the insurance is written for a specific amount regardless of the actual value of the goods. Option B is incorrect because it refers to a replacement cost basis, which means that the insurance is based on the cost of replacing the goods with new items. Option D is incorrect because it represents an actual cash value basis, which means that the insurance is written for the depreciated value of the goods. Therefore, option C is the correct answer because it accurately describes the type of coverage that Mark has.