An insured has an HO-3, no endorsements, with following limits: A-$70,000, B-$7,000, C-$35,000,

D-$14,000. The policy has a $500 deductible )$500 deductible for windstorm/hurricane).

What is the amount payble (if any) when: " A windstorm caused extensive damage to the roof of the insured's residence, requiring replacement of a portion. Cost to replace is $5,000. Taking depreciation into account, the actual cash value was $3,000. At the time of the loss, the replacement value of the dwelling was $15,000"?

ANS-

$BLANK is payable. $5,000 less $500 deductible= $4,500, but for full replacemet cost settlement, the insured needed not less than 80% of the full replacement value as the coverage A limit

($125,000 x 80%= $100,000).

please HELP i cannot seem to grasp the formula to uncover this answer. If someone could explain how to arrive at the answer. Thank you so much! :-)))