Week 12 Discussion

Week 12 Discussion - ACE 245 Discussion Sections Week 12...

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ACE 245 Discussion Sections – Week 12 Goals: 1) Be able to analyze basic insurance policy provisions and insurance need; 2) Be able to analyze stock trading information and compute stock yields 1. Joe has a health insurance policy with a $500 calendar year deductible, a $2,000 out-of-pocket cap, and an 80% coinsurance provision. If his first medical expense of the year is a $600 covered loss, how much will the insurance company pay? $ 80 2. Given a $250 annual deductible, a 20% copayment requirement and $5,000 annual limit on a policy-holder’s coinsurance costs, and a $250,000 policy limit, in the absence of any prior medical expenses in the current year, how much of a $27,500 medical bill would the insured have to pay? $5,250 = Min [5,250; {(27,500 – 250)*0.2 + 250}] 3. A fire destroyed a top-of-the-line barbeque grill that Daniel purchased 4 years ago for $3,000. Today, the same grill would cost $4,000. His homeowner’s insurance is subject to a $500 deductible per incident and reimburses for actual cash value. Furnishings are depreciated on a straight-line basis for 10 years. How much can Daniel expect to receive in the insurance
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Week 12 Discussion - ACE 245 Discussion Sections Week 12...

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