And total damages are $1 million, then Mook will get 10% of his damages. If his losses were $10k, he gets $1k. If $50k, he gets $5k.

If he has his own policy with personal property coverage, then there shouldn't be a 10% payout amount. It should be his losses minus deductible up to his policy limit. It's just his company might not make full recovery (should be their problem, not Mook's).