A shop and a godown worth ₹1,00,000 and ₹2,00,000 respectively were insured through an agent who was paid 12% of the total premium. If the shop was insured for 80% and the godown for 60% of their respective values, find the agent's commission, given that the rate of premium was 0.80% less 20%.

#### Solution

Given, Value of shop (property value) = ₹1,00,000.

Value of godown (property value) = ₹2,00,000

Rate of commission = 12%

Shop was insured for 80% of its value.

Policy value

= 80% of its property value

= `(80)/(100) xx 1,00,000`

= ₹80,000

Godown was insured for 60% of its value.

∴ Policy value of godown

= 60% of its property value

= `(60)/(100) xx 2,00,000`

= ₹1,20,000

Total policy value = Policy value of shop + Policy value of godown

= 80,000 + 1,20,000

= 2,00,000

Rate of premium is 0.80% less 20%

i.e., 0.80 0.20% of 0.80 = 0.80 0.16 = 0.64%

∴ Amount of perimum

= 0.64% of total policy value

= `(0.64)/(100) xx 2,00,000`

= ₹1,280

Commission of agent

= 12% of amount of perimum

= `(12)/(100) xx 1,280` = 153.6

∴ Agent's commission is ₹153.6.