An Arizona contractor with 5 employees has a workers' compensation policy with a $500 deductible per claim. If there are 3 claims during the year totaling $8,400 in costs, how much will the insurance company pay?
Correct Answer
A) $6,900
Insurance pays total claims minus deductibles: $8,400 - (3 claims × $500 deductible) = $8,400 - $1,500 = $6,900.
Why This Is the Correct Answer
Insurance pays total claims minus deductibles: $8,400 - (3 claims × $500 deductible) = $8,400 - $1,500 = $6,900.
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