The ABC Corporation has $100,000 of coverage on its building through insurance Company A, and $50,000 of identical coverage on the same building through insurance Company B. Assuming coinsurance is not an issue, when a $24,000 loss occurs and the pro rata method is used, how much will each insurer pay?

In this scenario, the pro rata method is utilized to distribute the loss proportionally based on the amount of coverage provided by each insurance company.

For Company A, which has $100,000 of coverage, and Company B, which has $50,000 of coverage, the total coverage on the building is $150,000. The pro rata shares of each insurer can be calculated by determining each company’s contribution to the total coverage.

Company A's contribution to the total coverage is $100,000, which is two-thirds (or 66.67%) of the total coverage. Company B's contribution is $50,000, which constitutes one-third (or 33.33%) of the total coverage.

When a loss of $24,000 occurs, Company A would cover two-thirds of that amount, which translates to $16,000 (66.67% of $24,000). Conversely, Company B would cover one-third, resulting in $8,000 (33.33% of $24,000).

Thus, each insurer pays the amounts in accordance with their respective shares of coverage relative to the total, resulting in Company A paying $16,000 and Company B paying $8,000, making