Kelly's vehicle is insured under basic Autoplan, including basic vehicle damage coverage (BVDC). She has also purchased optional collision coverage from ICBC, subject to a $500 deductible. She is involved in an accident with another British Columbia insured vehicle, and Kelly is 75 percent at fault. If Kelly sustains $6,000 in vehicle damage in this accident, how much will ICBC pay for the damage?

Rationale

ICBC will pay $5,500 for the damage.

In this scenario, Kelly's total vehicle damage amounts to $6,000. Since she is 75 percent at fault, ICBC will cover 75 percent of the damage after accounting for her deductible of $500.

A (4125 dollars) YOUR ANSWER

This option incorrectly calculates the payout by taking 75 percent of the total damage without properly factoring in the deductible. To find the correct payout, the deductible must first be subtracted from the total damage amount before applying the fault percentage.

B (4500 dollars) YOUR ANSWER

This choice represents an incorrect calculation as it reflects 75 percent of the total damage ($6,000) without considering the $500 deductible. The correct approach is to first deduct the $500, which affects the amount eligible for coverage.

C (5500 dollars) CORRECT

This is the correct answer. After deducting the $500 from the total damage of $6,000, $5,500 remains. Applying the 75 percent fault, ICBC will cover 75 percent of $5,500, which results in a payout of $5,500 for the damage.

D (5625 dollars) YOUR ANSWER

This option inaccurately reflects the payout by mistakenly including an additional amount. The calculation should strictly follow the process of deducting the $500 first from $6,000 and then applying the 75 percent at-fault calculation on the remaining amount.

Conclusion

Kelly's situation illustrates the importance of understanding fault percentages and deductibles in insurance claims. By deducting the $500 from the total damage of $6,000, ICBC covers 75 percent of the remaining amount, leading to a payout of $5,500. This ensures that both the deductible and the at-fault percentage are accurately accounted for in determining the insurance compensation.

ICBC will pay $5,500 for the damage.

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