Question

Jimmy has $25,000 worth of property damage insurance and a $500 deductible collision insurance policy. He runs into a light pole at Walmart and does $3,500 damage to the light pole and $5,200 damage to his car. How much will the insurance company pay to repair the light pole?

Answer 1

Answer: The insurance company will pay for $3,000 in damage to the light pole

Explanation:

Step 1: Jimmy's deductible is $500, so he will have to pay the first $500 of the repair costs.

Step 2: Since the damage to the light pole is less than $25,000, Jimmy's property damage insurance policy will cover the remaining repair costs for the light pole.

Step 3: The insurance company will pay for the remaining $3,000 ($3,500 - $500) to repair the light pole.