Question

if an insurance policy covers individual losses up to $15,000 and has a deductible of $1,000 the insured will be paid how much in the event of a covered loss of $10,000

Answer 1

In the event of a covered loss of $10,000, the insured will be paid $9,000 and bear $1,000.

A deductible is the amount of money an individual must pay out of pocket before their insurance coverage starts to cover the remaining costs of a covered expense or claim. It helps to reduce the insurer's risk by having the policyholder share in the initial cost of a claim.

This payment is calculated by subtracting the deductible of $1,000 from the covered loss of $10,000. Here, the insured is responsible for covering the first $1,000 of the loss and the insurance policy will reimburse them for the remaining $9,000.