Question

The accident caused $2,700 worth of damage to your car. You have liability coverage of 60/125/45 which costs you $286 per year. The book value of your car is $2,000. The annual cost for collision coverage is $226 with a $1500 deductible. 10. What is the cost per $1,000 per liability coverage?

Answer 1

The cost is $1.68 per $1000 per liability coverage

Step-by-step explanation:

In order to calculate the Cost per $1000 per liability coverage, according to the data we have, we would have to use the following formula:

Cost per $1000 per liability coverage = Annual liability coverage cost / (Maximum body injury coverage + Maximum property coverage coverage)

= [$286 / ($125 + $45)]

= ($286 / $170)

=$1.68

Hence, the cost is $1.68 per $1000 per liability coverage.