Florida Adjuster Licensing Exam 2026 – 400 Free Practice Questions to Pass the Exam

In this scenario, Sarah has an Extra Expense Coverage limit of $100,000 due to the fire that has shut down her factory. Extra Expense Coverage is designed to cover costs that exceed normal operating expenses incurred to avoid or minimize a business's loss of income during a shutdown.

Since the limit for her coverage is $100,000, the maximum amount Sarah can receive for her extra expenses is capped at this limit. The correct choice indicates that despite her expenses potentially exceeding that limit, she will only be reimbursed up to the full coverage amount since insurance policies typically provide reimbursement only to the extent of their limits and not beyond.

The figure of $80,000 suggests that her actual incurred expenses related to mitigation following the fire amounted to this total. Since the amount does not exceed the policy limit and is indeed less, receiving this amount is in alignment with how extra expenses are typically handled under such coverage provisions. Thus, Sarah would receive $80,000 in extra expenses up to her policy limit.