EXAMPLES OF LOSS CALCULATIONS TO DETERMINE AMOUNT RECOVERABLE

1. The following simplified examples outline the principles involved in calculating the amount recoverable under the different types of valuation:

1. Example - Depreciated Value of Furniture and Equipment

   Property Involved	Mess Furniture
   Cost Price	$10,000.00
   Date Purchased	January 1998
   Date of Loss	January 2000
   Cost to Replace (new)(Jan 00)	$12,000.00

   Since coverage is on an actual cash value basis, depreciation is deducted from the replacement cost. Assuming a rate of depreciation on furniture of 20% per annum, the amount recoverable is calculated as follows:

   Replacement Cost	$12,000.00
   Depreciation at 20% per year (2 years)	$ 4,800.00
   Amount Recoverable	$7,200.00
   (less applicable unit deductible)

2. Example - Replacement Cost

   Property   Golf Club Storage Building Built from NPF

   Cost Price	$20,000.00
   Date Effected	January 1996
   Date of Loss	January 2000
   Cost to Replace (new)	$25,000.00
   Amount Recoverable	$25,000.00
   (less applicable unit deductible)	(no deduction for depreciation)