Certainly! Let's break down the solution step-by-step to find out the owner's out-of-pocket cost for the repair in Event 1.
1. Identify the deductible:
The deductible is the amount the insurance policyholder must pay out-of-pocket before the insurance company pays the remaining costs. In this case, the deductible is [tex]$1,000.00.
2. Identify the repair cost for Event 1:
The repair cost for Event 1, which involves injury to a guest, is $[/tex]20,000.00.
3. Calculate the out-of-pocket cost:
According to the insurance policy, the policyholder must pay the deductible amount first. Therefore, for Event 1, the out-of-pocket cost that the owner needs to pay is equal to the deductible.
So, the owner's out-of-pocket cost for the repair in Event 1 is [tex]$1,000.00.
In summary:
- The deductible is $[/tex]1,000.00.
- The repair cost for Event 1 is [tex]$20,000.00.
- The out-of-pocket cost for the owner is $[/tex]1,000.00.
Thus, the owner’s out-of-pocket cost for the repair in Event 1 is $1,000.00.