Chapter 12, Insurance Video Solutions, Contemporary Business Mathematics for Colleges

Problem 1

Drivers Jim Olson and Joshua Stein live in a state having no-fault auto insurance. Joshua causes an accident by hitting Jim's car. Joshua isn't hurt. Jim spends 3 days in the hospital at a cost of $\$ 5,300$. Compute the amount that each driver's insurance company pays toward medical expenses.________

Zach Steedman

Numerade Educator

03:38

Problem 2

IXP insured an office building for $$\$ 290,000$$ for 1 year at a premium rate of $$\$ 7.20$$ per thousand. At the end of 9 months, IXP sold the building and canceled the policy. If the insurance company has a short-rate refund policy that includes a $10 \%$ penalty, how much refund did IXP receive?.________

Narayan Hari

Numerade Educator

04:21

Problem 3

Driver Devon Cooper has a poor driving record and pays double the usual premium as a high-risk driver. The regular premium would be $$\$ 490$$ for a year. If Devon must pay the high-risk premium every year for 5 years, how much more will he pay for insurance premiums than a low-risk driver receiving a $10 \%$ discount over the same 5-year period?.________

Jacob Fry

Numerade Educator

02:48

Problem 4

Insurance company A has a standard $90 \%$ coinsurance clause for all fire insurance coverage. Insurance company $\mathrm{B}$ has a standard $75 \%$ coinsurance clause for all fire insurance coverage. A building is valued at $$\$ 195,000$$. How much more insurance coverage would insurance company A require than insurance company B for full coinsurance coverage?.________

Christopher Stanley

Numerade Educator

Problem 5

The Morgan Company warehouse was valued at $$\$ 425,000$$. The building was insured for $$\$ 170,000$$. The policy contained an $80 \%$ coinsurance clause. A fire caused $$\$ 60,000$$ in damages. Compute the amount of the fire damage the Morgan company had to pay..________

Check back soon!

02:49

Problem 6

Mike Jankowski, age 27, purchased a $$\$ 35,000,20$$-payment life policy with premiums payable annually. John Jamison, also age 27 , purchased a $$\$ 35,000$$ straight life policy with premiums payable semiannually. Both Mike and John lived 40 more years. How much more in premiums did John pay the insurance company during his lifetime than Mike paid during his?.________

Puneet Prajapati

Numerade Educator

Problem 7

Sally Munson, age 25 , purchased a $$\$ 35,000,20$$-payment life policy. Five years later she needed cash. Compute the maximum amount she could borrow on the policy..________

Check back soon!

03:21

Problem 8

An employer provided group health coverage that includes a $$\$ 600$$ annual deductible per family and payment of $80 \%$ of costs exceeding the deductible amount. An employee with no dependents incurs $$\$ 4,800$$ in medical expenses during the year. How much of the medical costs must the employee pay?.________

Kami Dupree

Numerade Educator