What is a co-insurance clause?

A co-insurance clause is a clause in an insurance contract in California that requires an insured to carry a certain minimum amount of coverage in order to be eligible for a claim payment. This clause is based on the idea that when an insured person purchases insurance, they are taking on financial responsibility for any losses they may suffer. A co-insurance clause ensures that the insured has enough coverage to cover any potential costs associated with those losses. In California, co-insurance clauses are used to make sure that the insured has enough coverage to cover the full cost of a loss. The clause requires the insured to maintain their coverage at a certain percentage of the total value of the property or service. In exchange, the insurance company agrees to pay a certain portion of any claim costs. For example, if the insured has a policy with a 90% co-insurance clause and suffers a loss of $100,000, then the insurance company will pay 90% of the claim costs, or $90,000. Co-insurance clauses are an important part of the insurance contract and must be understood in order to ensure that the insured has enough coverage to cover potential losses. It also serves to protect the insurance company, as they do not want to be left paying for a large portion of a claim where the insured has not maintained their coverage at the specified level.

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What is a co-insurance clause?

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