Question

a homeowner purchases a property for $480,000 and the home insurance rate is 0.25%. what is the monthly premium for this home insurance policy? $150 $120 $200 $100

Explanation:

Step1: Calculate annual premium

First, find the annual insurance premium by multiplying the property value by the insurance rate. The formula is: Annual Premium = Property Value × Insurance Rate. So, \( 480000\times0.25\% = 480000\times0.0025 = 1200 \).

Step2: Calculate monthly premium

Then, divide the annual premium by 12 to get the monthly premium. Monthly Premium = Annual Premium ÷ 12. So, \( 1200\div12 = 100 \).

Answer:

\$100