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South Carolina Casualty Practice Exam

20 exam-style questions drawn from the same bank as our full South Carolina Casualty course (South Carolina Insurance Producer - Casualty - Exam Prep). Answer all 20, then grade yourself — most state exams require 70% to pass. Explanations for every question are part of the full course.

1. A general contractor's CGL has a $1,000,000 each-occurrence limit, a $2,000,000 general aggregate, and a $2,000,000 products-completed operations aggregate. The contractor has paid out $800,000 in premises slip-and-fall claims this year. How much remains for a $1,000,000 ongoing-operations claim at a different job site?
$0, the aggregate is exhausted by the prior premises claims under the dual-occurrence depletion rule$1,000,000 from the products-completed operations aggregate because operations claims draw from the products aggregate$1,000,000, the each-occurrence limit applies, and $1.2M of general aggregate remains$200,000, only the unused portion of the general aggregate remains after the prior premises claims totaling $800K
2. Under strict liability (e.g., abnormally dangerous activities like blasting, or product liability), what does the plaintiff NOT need to prove?
The extent of the plaintiff's damages.That the activity or product caused the harm.That the defendant was negligent, i.e., breached a duty of care.That the defendant engaged in the activity or sold the product.
3. An attorney's E&O policy provides limits of $1M each claim / $1M aggregate, with defense costs INSIDE the limit. A claim settles for $700,000, and defense costs are $400,000. How much of the policy limit remains for future claims this period?
$300,000, because only the indemnity portion of each claim erodes the aggregate limit$0, total payments of $1.1M exceed the $1M aggregate; insurer pays $1M and stops$600,000, because defense costs are paid as supplementary payments outside the limit$1,000,000, because the aggregate limit restores in full after each claim is closed
4. Most professional liability policies are written on a:
Claims-made trigger with retroactive date and (often) extended reporting period (ERP / 'tail')Pure occurrence trigger like the CG 00 01 commercial general liability occurrence form, which is uncommon for professional E&O linesDiscovery basis only, a trigger associated with ISO commercial crime forms rather than professional liability E&O policiesLoss-paid basis triggered solely by actual payment of indemnity, which is a workers' compensation Part Two construct rather than a professional E&O trigger
5. Part A of the Personal Auto Policy (PAP) provides:
Physical damage to the auto under collision and other-than-collisionUninsured motorist coverage for at-fault uninsured or hit-and-run driversLiability for bodily injury and property damage caused by the insuredMedical payments to the insured and passengers regardless of fault
6. An insured has a $1,000,000 CGL and a $5,000,000 umbrella with a $10,000 self-insured retention (SIR) that applies to losses not covered by the underlying. A claim NOT covered by the CGL (but covered by the umbrella's broader wording) settles for $260,000. How is the loss paid?
Insured pays $10,000 SIR; CGL pays $250,000; umbrella pays nothing.Umbrella pays the full $260,000; the insured pays nothing at all.Insured pays $10,000 SIR; umbrella pays $250,000; CGL pays nothing.CGL pays $250,000; umbrella pays the $10,000 SIR on the insured's behalf.
7. An agency wants to pay an unlicensed employee a percentage of premium for referrals that lead to sales. What does S.C. Code Ann. 38-43-200 say?
It is prohibited, and the prohibition binds both the payer and the unlicensed recipientIt is permitted so long as the unlicensed employee never speaks to the customerIt is permitted if the agency discloses the arrangement to the insurer in writingIt is prohibited for the agency to pay, but the unlicensed recipient bears no exposure
8. An insurer terminates a producer's appointment for a reason listed in S.C. Code Ann. 38-43-130. What does 38-43-55 require of the insurer?
Notify the Director within thirty days and state the reason for the terminationNotify the Director only at the next biennial appointment renewal in SeptemberNotify the Director within sixty days and state the reason for the terminationNotify the Director within fifteen days but withhold the reason unless it is requested
9. Vicarious liability imposes liability on one party for the acts of another. Which example BEST illustrates vicarious liability?
A property owner is held liable for injuries to a trespasser caused by a hidden hazard the owner deliberately created.An employer is held liable for injuries caused by an employee driving within the course and scope of employment.A driver is held liable for injuries caused by the driver's own negligence while running a red light at an intersection.A manufacturer is held liable for a defective product without proof of negligence under strict liability rules.
10. A general contractor is named as an additional insured on a subcontractor's CGL policy for a jobsite project. Which statement BEST describes the GC's insurable interest in the sub's CGL?
The GC's insurable interest arises from its legal exposure to suits stemming from the sub's operations on the projectThe GC's insurable interest is limited to the physical property on the jobsite, not liability exposureThe GC has no insurable interest because it does not own the sub's operations or equipmentThe AI endorsement itself creates the insurable interest where none existed before
11. On the ISO commercial crime form, 'Computer Fraud' (Insuring Agreement A6) covers:
Property damage caused by a sudden hardware crash or operating-system failure on the insured's office computers, an exposure covered under an EDP equipment policy and not under any crime form including A6The use of a computer to fraudulently cause the transfer of money, securities, or other property from inside the premises to a person/place outside the premisesTheft of insured laptops and portable computing hardware from the insured location, an exposure covered under the BPP commercial property or an EDP/computer floater rather than the A6 Computer Fraud insuring agreementPhishing of personal customer data from the insured's databases by external bad actors, an exposure addressed by a stand-alone cyber liability policy rather than the A6 Computer Fraud insuring agreement
12. An insured signs a contract waiving all rights of recovery against a customer, then suffers a loss the customer caused. What is the effect on the insurer?
It voids the policy from inception, because the insured has concealed a material factIt has no effect, because subrogation rights belong to the insurer and cannot be waivedIt may have prejudiced the insurer's subrogation right, which the policy conditions forbidIt obliges the customer's insurer to pay the claim directly to the insured instead
13. A general contractor's WC policy is written with a $12,000 DEPOSIT PREMIUM based on projected payroll of $600,000. Actual audited payroll is $720,000. What is MOST likely to happen?
The insurer bills an ADDITIONAL premium, typically about $2,400, based on the higher audited payroll.The insurer cancels the policy for misrepresenting the projected payroll on the application.Nothing changes, because the deposit premium is the final premium for the policy term once paid.The insurer refunds part of the deposit premium, because higher payroll earns a volume discount on WC rates.
14. A covered liability claim against an insolvent South Carolina insurer is valued at four hundred thousand dollars. What does the Guaranty Association pay?
One percent of the claim, matching the annual assessment cap on member insurersUp to the three hundred thousand dollar ceiling, less the two hundred fifty dollar deductibleNothing, because the claim exceeds the Association's maximum and is left to the liquidationThe full four hundred thousand dollars, since liability claims carry no statutory ceiling
15. A commercial general liability policy shows a 1,000,000 dollar per-occurrence limit and a 2,000,000 dollar general aggregate. Two unrelated covered claims settle at 800,000 dollars each. What is payable?
Only 1,000,000 dollars in total, because the per-occurrence limit caps the policy yearBoth claims in full, 1,600,000 dollars, because neither limit has been exhaustedOnly 800,000 dollars, because the per-occurrence limit applies once per policy period2,000,000 dollars, because the aggregate is always paid where two claims are made
16. An electrician trips over his own toolbox while installing wiring inside a customer's office building and is injured. He sues the customer for failing to maintain a safe workplace. From the CUSTOMER's CGL perspective, which hazard category responds?
Operations, the customer was conducting business operations and the loss attaches to ongoing operationsProducts-completed operations, the wiring contract is treated as a completed product the customer soldNo coverage, the electrician was a contractor and contractor-on-premises injuries are excluded under the standard CGLPremises liability, the injured party is a third party on the insured's premises
17. Which of the following is a SPECULATIVE risk (and therefore not insurable by P&C insurers)?
Slip-and-fall on a customer's walkwayFire damage to a buildingGain or loss from stock tradingAuto accident
18. A licensee receives a final cease and desist order from the Director and believes it is wrong. What is the correct course?
File written comments with the Department, which automatically stays the orderComply with the order and seek review through the Administrative Law CourtContinue the conduct while the appeal is pending, since the order is not yet finalIgnore the order, because a cease and desist order carries no penalty of its own
19. What are the maximum durations for TOTAL and for PARTIAL disability benefits under S.C. Code Ann. 42-9-10 and 42-9-20?
Five hundred weeks for total disability and three hundred forty weeks for partialThree hundred forty weeks for total disability and five hundred weeks for partialFour hundred weeks for total disability and three hundred weeks for partialFive hundred weeks for both total disability and partial disability alike
20. On a commercial crime policy, which insuring agreement responds when an employee steals $50,000 from the company?
Forgery/AlterationEmployee TheftComputer FraudInside Robbery

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