Leroy bought a homeowner's insurance policy when he purchased his new home. He pays an annual premium of $825 for property coverage of $300,000 and liability coverage of $400,000. His deductible is $1,400. Leroy pays this premium for 14 years, at which point Leroy's dog bites a neighbor walking down his sidewalk. The neighbor sues Leroy for $22,000 in medical bills and pain and suffering. Leroy submits this as a claim to his homeowner's insurance company. If the claim is approved, how much will Leroy's insurance company pay the neighbor?

Question

ganeshie8 · Answer

So, the medical bills are $22,000

ganeshie8 · Answer

do u think the insurance pays entire amount ?

anonymous · Answer

I would honestly think that they would pay nothing concidering it's nothing to really do with the home, but that's not an option, so im thinking that they may not pay it all?

ganeshie8 · Answer

His deductible is $1,400.

He has to pay this amount first, after that only insurance kicks in.... 
so money paid by insurance company  =   22,000 -  1400

ganeshie8 · Answer

Lol, we have insurance for everything now a days....

anonymous · Answer

so he would still need to pay 20,600

ganeshie8 · Answer

He pays an annual premium of $825 for property coverage of $300,000 and $\text{liability coverage of \$400,000}$.

ganeshie8 · Answer

Liability coverage assuress his dog to bite ppl for $400,000 every year :)

anonymous · Answer

lol thats funny xD but so the insurance pays the rest of it which would be 20,600?

ganeshie8 · Answer

Correct ! he has to pay only the deductible 1400; remaining money insurance takes care...

anonymous · Answer

cool! thank you :D

ganeshie8 · Answer

np :)