Which of the following situations shows the insured is adequately covered in the event of a loss?

Having $80,000 coverage on property worth $100,000 indicates the insured is adequately covered for potential losses. Adequate coverage generally means that the policy limit is sufficient to cover the replacement cost or fair market value of the property in the event of a loss. In this case, the coverage is close to the actual value of the property, providing a reasonable safety net for the insured.

When evaluating scenarios like this one, it is critical to consider the ratio of coverage to the actual value of the property. In option D, the coverage amount represents a substantial portion of the property's value, leaving only a $20,000 gap. This ensures that the insured would likely be able to recover most of the loss if a claim were to occur.

In contrast, other options present varying degrees of underinsurance. For instance, options involving coverage amounts significantly below the value of the property, such as $70,000 for a $100,000 property or $40,000 for a $90,000 property, suggest inadequate coverage that would leave the insured exposed to significant financial loss. Similarly, although $170,000 coverage on a $300,000 property ($130,000 gap) seems substantial, it still does not provide adequate protection relative to