South Carolina Property and Casualty
Insurance Exam QUESTIONS AND
ANSWERS
The process an insurer uses to evaluate applications and determine if a policy should be
issued and on what terms, conditions, and rate is known as? - ANSWER>>Underwriting
The Director is conducting an examination of a foreign company transacting business in South
Carolina. Who is responsible for the cost of the examination? - ANSWER>>Foreign company
Driver A has a personal auto policy with Part C: UM/UIM limits of 100/300. He is injured by
Driver B who has Part A: Bodily Injury Liability Limits of 50/100. It is determined that Driver B
is at fault for the accident . Driver A has $125,000 in medical expenses. How much will Part C:
UM/UIM coverage will pay? - ANSWER>>50,000
A premium discount is the term that describes when an insured owes a total standard
premium greater than? - ANSWER>>5,000
According to SC law, comprehensive deductibles do not apply to - ANSWER>>safety glass
Who is an insurance producer? - ANSWER>>Any person licensed to sell, solicit or negotiate
insurance
Employee fidelity may be written in all the following ways EXCEPT - ANSWER>>Location
schedule
Section 1 of boatowners policy covers - ANSWER>>Physical Damage
Which type of losses are covered by the South Carolina Wind and Hail Underwriting
Association? - ANSWER>>Both Direct and Indirect losses
Before granting a Certificate of Authority to a company, the Director must be satisfied by
proper evidence that all of the following are true EXCEPT - ANSWER>>The insurer does not
have a Certificate of Authority in any other state
,Erroneous Publishing copied all the material from Angels Inc.'s book. The only changes made
by Erroneous were to rename the title and chapters, put a different cover on it, and distribute
it as its own. Angels Inc. files a claim against Erroneous and seeks damages. Will a commercial
general liability policy cover the claim? - ANSWER>>No, because the claim results from
copyright infringement and is not in an advertisement
When the insured's car was totaled in a recent accident, the ownership of the car was
transferred to the insurer. The insurer then sold off the wrecked car to recover some of the
loss it paid to the insured. What is the term for this action? - ANSWER>>Salvage
The reduction, decrease, or disappearance of value of the person or property insured in a
policy by a peril insured against is known as - ANSWER>>loss
A plasterer has finished a job. What kind of liability coverage would protect him if the plaster
falls and hurts someone because he did not do the job correctly? - ANSWER>>Completed
operations
Which employee fidelity bond pays no more than its limit of liability for each separate
occurrence no matter that several separately identifiable employees were involved in a single
loss? - ANSWER>>commercial blanket position
If an employee consumes alcohol, becomes intoxicated, and is injured at work, he/she is
__________. - ANSWER>>Not covered if the consumption of alcohol is proven to have caused
the injury
Under Coverage C of a farm policy, what is the limit payable on business property located
away from the premises? - ANSWER>>$500
Within how many days of requesting an investigative consumer report must an insurer notify
the consumer in writing that the report will be obtained? - ANSWER>>5 days
What is the purpose of the government crime coverage form? - ANSWER>>To provide crime
coverage to those who do not qualify in the normal market
Which of the following insurance options would be considered a risk-sharing arrangement? -
ANSWER>>Reciprocal
, According to the loss payment condition in HO policies, losses must be paid within how many
days of the insurer receiving proof of loss? - ANSWER>>60 days
Which of the following is true of dwelling policy coverage? - ANSWER>>Exclusion apply to all
three policy forms
The individual named insured endorsement under a commercial auto policy provides
coverage for which of the following? - ANSWER>>The sole proprietor of the business and his
or hers family members
The type of crime policy under which coverage is triggered by a loss that happens during the
policy period but is not necessarily discovered during the policy period is the _____________.
- ANSWER>>Loss sustained form
What type of coverage protects the insured in an accident caused by a driver with insufficient
coverage? - ANSWER>>Underinsured Motorist
In which of the following sections of a commercial auto policy will you find specific
information about the policy period? - ANSWER>>Conditions
Faulty wiring in a home is an example of a _______. - ANSWER>>Hazard
Which of the following list all the required elements for establishing a charge of negligence? -
ANSWER>>legal duty owed, standard of care, proximate cause, damages
Which of the following is true regarding the premium computation for workers compensation
insurance? - ANSWER>>a premium auditor has the right to examine the insured's
compensation records at the end of the policy period to determine the actual premium basis
Which of the following is NOT the consideration in a policy? - ANSWER>>The application
given to a prospective insured
All are true about the South Carolina Property and Casualty Insurance Guaranty Association
EXCEPT: - ANSWER>>It does not cover workers compensation claims
Which of the following statements is INCORRECT with regard to surplus lines insurance? -
ANSWER>>Policies written by a surplus lines insurer typically contain standard coverages and
forms
Insurance Exam QUESTIONS AND
ANSWERS
The process an insurer uses to evaluate applications and determine if a policy should be
issued and on what terms, conditions, and rate is known as? - ANSWER>>Underwriting
The Director is conducting an examination of a foreign company transacting business in South
Carolina. Who is responsible for the cost of the examination? - ANSWER>>Foreign company
Driver A has a personal auto policy with Part C: UM/UIM limits of 100/300. He is injured by
Driver B who has Part A: Bodily Injury Liability Limits of 50/100. It is determined that Driver B
is at fault for the accident . Driver A has $125,000 in medical expenses. How much will Part C:
UM/UIM coverage will pay? - ANSWER>>50,000
A premium discount is the term that describes when an insured owes a total standard
premium greater than? - ANSWER>>5,000
According to SC law, comprehensive deductibles do not apply to - ANSWER>>safety glass
Who is an insurance producer? - ANSWER>>Any person licensed to sell, solicit or negotiate
insurance
Employee fidelity may be written in all the following ways EXCEPT - ANSWER>>Location
schedule
Section 1 of boatowners policy covers - ANSWER>>Physical Damage
Which type of losses are covered by the South Carolina Wind and Hail Underwriting
Association? - ANSWER>>Both Direct and Indirect losses
Before granting a Certificate of Authority to a company, the Director must be satisfied by
proper evidence that all of the following are true EXCEPT - ANSWER>>The insurer does not
have a Certificate of Authority in any other state
,Erroneous Publishing copied all the material from Angels Inc.'s book. The only changes made
by Erroneous were to rename the title and chapters, put a different cover on it, and distribute
it as its own. Angels Inc. files a claim against Erroneous and seeks damages. Will a commercial
general liability policy cover the claim? - ANSWER>>No, because the claim results from
copyright infringement and is not in an advertisement
When the insured's car was totaled in a recent accident, the ownership of the car was
transferred to the insurer. The insurer then sold off the wrecked car to recover some of the
loss it paid to the insured. What is the term for this action? - ANSWER>>Salvage
The reduction, decrease, or disappearance of value of the person or property insured in a
policy by a peril insured against is known as - ANSWER>>loss
A plasterer has finished a job. What kind of liability coverage would protect him if the plaster
falls and hurts someone because he did not do the job correctly? - ANSWER>>Completed
operations
Which employee fidelity bond pays no more than its limit of liability for each separate
occurrence no matter that several separately identifiable employees were involved in a single
loss? - ANSWER>>commercial blanket position
If an employee consumes alcohol, becomes intoxicated, and is injured at work, he/she is
__________. - ANSWER>>Not covered if the consumption of alcohol is proven to have caused
the injury
Under Coverage C of a farm policy, what is the limit payable on business property located
away from the premises? - ANSWER>>$500
Within how many days of requesting an investigative consumer report must an insurer notify
the consumer in writing that the report will be obtained? - ANSWER>>5 days
What is the purpose of the government crime coverage form? - ANSWER>>To provide crime
coverage to those who do not qualify in the normal market
Which of the following insurance options would be considered a risk-sharing arrangement? -
ANSWER>>Reciprocal
, According to the loss payment condition in HO policies, losses must be paid within how many
days of the insurer receiving proof of loss? - ANSWER>>60 days
Which of the following is true of dwelling policy coverage? - ANSWER>>Exclusion apply to all
three policy forms
The individual named insured endorsement under a commercial auto policy provides
coverage for which of the following? - ANSWER>>The sole proprietor of the business and his
or hers family members
The type of crime policy under which coverage is triggered by a loss that happens during the
policy period but is not necessarily discovered during the policy period is the _____________.
- ANSWER>>Loss sustained form
What type of coverage protects the insured in an accident caused by a driver with insufficient
coverage? - ANSWER>>Underinsured Motorist
In which of the following sections of a commercial auto policy will you find specific
information about the policy period? - ANSWER>>Conditions
Faulty wiring in a home is an example of a _______. - ANSWER>>Hazard
Which of the following list all the required elements for establishing a charge of negligence? -
ANSWER>>legal duty owed, standard of care, proximate cause, damages
Which of the following is true regarding the premium computation for workers compensation
insurance? - ANSWER>>a premium auditor has the right to examine the insured's
compensation records at the end of the policy period to determine the actual premium basis
Which of the following is NOT the consideration in a policy? - ANSWER>>The application
given to a prospective insured
All are true about the South Carolina Property and Casualty Insurance Guaranty Association
EXCEPT: - ANSWER>>It does not cover workers compensation claims
Which of the following statements is INCORRECT with regard to surplus lines insurance? -
ANSWER>>Policies written by a surplus lines insurer typically contain standard coverages and
forms
