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NC Surplus Lines Exam & Solutions: Comprehensive Guide, Exams of Insurance law

North Carolina Central University (NCCU)Insurance law

A comprehensive overview of the nc surplus lines exam, covering key concepts, regulations, and procedures related to surplus lines insurance in north carolina. It includes a series of questions and answers that test understanding of the subject matter, making it a valuable resource for individuals seeking to obtain a surplus lines license in the state.

Typology: Exams

2024/2025

Available from 02/11/2025

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NC Surplus Lines Exam with solutions
Surplus |!|Lines |!|Characteristics |!|- |!|correct |!|answer |!|✔-Unique
-Distressed
-High |!|Limits
-Tailored |!|Coverage |!|Forms
At |!|the |!|end |!|of |!|2019, |!|how |!|many |!|P&C |!|insurance |!|companies |!|were |!|operating |!|in |!|the |!|US? |!|- |!|
correct |!|answer |!|✔2496
Standard |!|carriers |!|write |!|over |!|___ |!|of |!|the |!|insurance |!|in |!|the |!|state. |!|- |!|correct |!|answer |!|✔90%
E&S |!|companies |!|are |!|not |!|required |!|to |!|do |!|what? |!|- |!|correct |!|answer |!|✔File |!|their |!|rates |!|or |!|forms |!|
with |!|the |!|DOI.
NCSLA |!|(NC |!|Surplus |!|Lines |!|Organization) |!|- |!|correct |!|answer |!|✔A |!|regulatory |!|support |!|organization |!|
for |!|all |!|NC |!|surplus |!|lines |!|licensees |!|and |!|the |!|NC |!|DOI.
How |!|many |!|employees |!|of |!|each |!|entity |!|that |!|procures |!|SL |!|policies |!|in |!|NC |!|must |!|have |!|a |!|SL |!|
license? |!|- |!|correct |!|answer |!|✔All |!|employees |!|must |!|have |!|an |!|individual |!|license.
What |!|if |!|an |!|agency |!|has |!|a |!|NC |!|Business |!|Entity |!|SL |!|license? |!|- |!|correct |!|answer |!|✔Only |!|those |!|listed
|!|as |!|licensees |!|under |!|the |!|Business |!|Entity |!|license |!|are |!|considered |!|duly |!|licensed. |!|
Must |!|have |!|an |!|individual |!|NC |!|surplus |!|lines |!|license.
Does |!|a |!|NC |!|surplus |!|lines |!|licensee |!|need |!|to |!|register |!|and |!|pay |!|dues |!|annually |!|to |!|the |!|NCSLA? |!|- |!|
correct |!|answer |!|✔No. |!|Once |!|you |!|receive |!|the |!|license, |!|you |!|are |!|already |!|considered |!|a |!|member. |!|
Membership |!|dues |!|are |!|no |!|longer |!|required.
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NC Surplus Lines Exam with solutions

Surplus |!|Lines |!|Characteristics |!|- |!|correct |!|answer |!| ✔ -Unique -Distressed -High |!|Limits -Tailored |!|Coverage |!|Forms At |!|the |!|end |!|of |!|2019, |!|how |!|many |!|P&C |!|insurance |!|companies |!|were |!|operating |!|in |!|the |!|US? |!|- |!| correct |!|answer |!| ✔ 2496 Standard |!|carriers |!|write |!|over |!|___ |!|of |!|the |!|insurance |!|in |!|the |!|state. |!|- |!|correct |!|answer |!| ✔ 90% E&S |!|companies |!|are |!|not |!|required |!|to |!|do |!|what? |!|- |!|correct |!|answer |!| ✔ File |!|their |!|rates |!|or |!|forms |!| with |!|the |!|DOI. NCSLA |!|(NC |!|Surplus |!|Lines |!|Organization) |!|- |!|correct |!|answer |!| ✔ A |!|regulatory |!|support |!|organization |!| for |!|all |!|NC |!|surplus |!|lines |!|licensees |!|and |!|the |!|NC |!|DOI. How |!|many |!|employees |!|of |!|each |!|entity |!|that |!|procures |!|SL |!|policies |!|in |!|NC |!|must |!|have |!|a |!|SL |!| license? |!|- |!|correct |!|answer |!| ✔ All |!|employees |!|must |!|have |!|an |!|individual |!|license. What |!|if |!|an |!|agency |!|has |!|a |!|NC |!|Business |!|Entity |!|SL |!|license? |!|- |!|correct |!|answer |!| ✔ Only |!|those |!|listed |!|as |!|licensees |!|under |!|the |!|Business |!|Entity |!|license |!|are |!|considered |!|duly |!|licensed. |!| Must |!|have |!|an |!|individual |!|NC |!|surplus |!|lines |!|license. Does |!|a |!|NC |!|surplus |!|lines |!|licensee |!|need |!|to |!|register |!|and |!|pay |!|dues |!|annually |!|to |!|the |!|NCSLA? |!|- |!| correct |!|answer |!| ✔ No. |!|Once |!|you |!|receive |!|the |!|license, |!|you |!|are |!|already |!|considered |!|a |!|member. |!| Membership |!|dues |!|are |!|no |!|longer |!|required.

Is |!|it |!|mandatory |!|to |!|register |!|for |!|the |!|NC |!|Surplus |!|Lines |!|Information |!|Portal |!|(SLIP)? |!|- |!|correct |!| answer |!| ✔ If |!|you |!|do |!|not |!|write |!|any |!|nonadmitted |!|policies |!|in |!|NC, |!|there |!|is |!|no |!|need. What |!|is |!|the |!|NC |!|surplus |!|lines |!|tax? |!|- |!|correct |!|answer |!| ✔ 5% |!|of |!|gross |!|premium |!|(less |!|any |!|return |!|premium) What |!|is |!|the |!|NC |!|surplus |!|lines |!|stamping |!|fee? |!|- |!|correct |!|answer |!| ✔ 0.4% Are |!|broker |!|fees |!|subject |!|to |!|the |!|5% |!|tax? |!|- |!|correct |!|answer |!| ✔ No. Purposes; |!|necessity |!|for |!|regulation |!|(58-21-5) |!|- |!|correct |!|answer |!| ✔ -Protect |!|customers |!|seeking |!| insurance -Allow |!|SL |!|insurance |!|to |!|be |!|placed |!|with |!|reputable |!|and |!|financially |!|sound |!|nonadmitted |!|insurers -Establish |!|a |!|regulatory |!|system -Protect |!|state |!|revenues Admitted |!|- |!|correct |!|answer |!| ✔ Licensed |!|to |!|do |!|business |!|in |!|NC Export |!|- |!|correct |!|answer |!| ✔ Placing |!|SL |!|insurance |!|with |!|a |!|nonadmitted Nonadmitted |!|Domestic |!|SL |!|Insurer |!|- |!|correct |!|answer |!| ✔ An |!|insurer |!|that |!|is |!|not |!|licensed |!|but |!|is |!| domiciled |!|in |!|the |!|state |!|and |!|is |!|authorized |!|to |!|transact |!|surplus |!|lines |!|there. Producing |!|Broker |!|- |!|correct |!|answer |!| ✔ A |!|licensed |!|agent |!|or |!|broker |!|that |!|deals |!|directly |!|with |!|the |!|insurance |!|seeker |!|& |!|may |!|also |!|be |!|a |!|SL |!|licensee. Home |!|State |!|(58-21-11) |!|- |!|correct |!|answer |!| ✔ 1. |!|The |!|state |!|where |!|the |!|insured's |!|principal |!|place |!|of |!|business |!|or |!|residence |!|is |!|located. OR

  1. |!|If |!|all |!|risk |!|is |!|outside |!|that |!|state, |!|it's |!|the |!|state |!|where |!|the |!|largest |!|percentage |!|of |!|insured's |!| taxable |!|premium |!|is |!|allocated.

Nonadmitted |!|Domestic |!|Surplus |!|Lines |!|Insurer |!|(58-21-21) |!|- |!|correct |!|answer |!| ✔ An |!|insurance |!| company |!|in |!|the |!|state |!|can |!|become |!|a |!|nonadmitted |!|domestic |!|SL |!|insurer |!|if |!|it |!|has |!|at |!|least |!|$ |!|million |!|in |!|capital |!|and |!|surplus The |!|amount |!|of |!|salary |!|protection |!|plus |!|the |!|amount |!|of |!|any |!|in-force |!|disability |!|income |!|insurance |!|should |!|not |!|exceed |!|___ |!|of |!|the |!|individual's |!|annual |!|earned |!|income. |!|- |!|correct |!|answer |!| ✔ 75% Reasons |!|for |!|withdrawal |!|of |!|eligibility |!|from |!|a |!|SL |!|insurer |!|(58-21-30) |!|- |!|correct |!|answer |!| ✔ - |!| Financially |!|unstable |!|or |!|untrustworthy

  • |!|Non |!|longer |!|meet |!|eligibility |!|requirements
  • |!|Have |!|intentionally |!|broken |!|state |!|laws
  • |!|Fails |!|to |!|pay |!|valid |!|claims |!|promptly Duty |!|to |!|file |!|and |!|retain |!|reports |!|(58-21-35) |!|- |!|correct |!|answer |!| ✔ Agent |!|must |!|file |!|a |!|report |!|with |!| the |!|commissioner |!|within |!| 30 |!|days |!|of |!|binding |!|SL |!|insurance |!|policy. All |!|agents |!|who |!|deal |!|with |!|SL |!|insurance |!|must |!|be |!|members |!|of |!|________ |!|to |!|keep |!|their |!|license. |!|- |!|correct |!|answer |!| ✔ NC |!|Surplus |!|Lines |!|Association |!|(NCSLA) Evidence |!|of |!|insurance; |!|changes; |!|penalty |!|- |!|correct |!|answer |!| ✔ Once |!|arranged, |!|the |!|agent |!|must |!| quickly |!|give |!|the |!|policy |!|to |!|the |!|customer. |!|If |!|not |!|ready |!|yet, |!|agent |!|must |!|give |!|a |!|temp |!| document |!|(certificate, |!|cover |!|note, |!|or |!|binder). Required |!|notice |!|for |!|nonadmitted |!|domestic |!|insurers |!|- |!|correct |!|answer |!| ✔ The |!|insurance |!| company |!|with |!|which |!|this |!|coverage |!|has |!|been |!|placed |!|is |!|domiciled |!|and |!|authorized |!|by |!|the |!| State |!|of |!|NC |!|and |!|is |!|subject |!|to |!|its |!|supervision. |!|However, |!|in |!|the |!|event |!|of |!|the |!|insolvency |!|of |!| the |!|insurance |!|company, |!|losses |!|under |!|this |!|policy |!|will |!|not |!|be |!|paid |!|by |!|any |!|State |!|insurance |!| guaranty |!|or |!|solvency |!|fund. Required |!|notice |!|for |!|other |!|nonadmitted |!|insurers |!|- |!|correct |!|answer |!| ✔ The |!|insurance |!|company |!| with |!|which |!|this |!|coverage |!|has |!|been |!|placed |!|is |!|NOT |!|licensed |!|by |!|the |!|state |!|of |!|NC |!|and |!|is |!|not |!| subject |!|to |!|its |!|supervision. |!|In |!|the |!|event |!|of |!|the |!|insolvency |!|of the |!|insurance |!|company, |!|losses |!|under |!|this |!|policy |!|will |!|not |!|be |!|paid |!|by |!|any |!|State |!|insurance |!| guaranty |!|or |!|solvency |!|fund.

Duty |!|to |!|notify |!|insured. |!|(58-21-50) |!|- |!|correct |!|answer |!| ✔ Agents |!|must |!|notify |!|customers |!|about |!| important |!|details |!|regarding |!|nonadmitted |!|or |!|nonadmitted |!|domestic |!|insurer |!|BEFORE |!|the |!| contract |!|becomes |!|official |!|and |!|premium |!|is |!|due. Licensing |!|of |!|SL |!|license |!|(58-21-65) |!|- |!|correct |!|answer |!| ✔ How |!|to |!|obtain |!|SL |!|license:

  • |!|Hold |!|a |!|current |!|P&C |!|agent |!|license
  • |!|Pay |!|the |!|required |!|fees |!|to |!|the |!|Commissioner
  • |!|Compete |!|and |!|submit |!|an |!|application
  • |!|Pass |!|a |!|qualifying |!|SL |!|exam SL |!|licenses |!|are |!|issued |!|on |!|______ |!|, |!|and |!|expire |!|on |!|______ |!|every |!|year. |!|- |!|correct |!|answer |!| ✔ September |!|1, |!|August |!| 31 Renewal |!|applications |!|must |!|be |!|submitted |!|____ |!|before |!|license |!|expiration. |!|- |!|correct |!|answer |!| ✔ 30 |!|days If |!|a |!|license |!|lapses |!|and |!|is |!|not |!|reinstated |!|within |!|____, |!|the |!|agent/broker |!|must |!|retake |!|the |!| exam |!|and |!|submit |!|a |!|new |!|application. |!|- |!|correct |!|answer |!| ✔ 2 |!|years What |!| 2 |!|invoices |!|are |!|available |!|in |!|licensees' |!|SLIP |!|account |!|at |!|the |!|end |!|of |!|each |!|quarter? |!|- |!| correct |!|answer |!| ✔ 1. |!|Invoice |!|for |!|taxes |!|due
  1. |!|Invoice |!|for |!|stamping |!|fees |!|due Surplus |!|Lines |!|taxes |!|are |!|paid |!|via |!|_____ |!|to |!|_____. |!|- |!|correct |!|answer |!| ✔ ACH, |!|NCDOI Stamping |!|fees |!|are |!|paid |!|via |!|_____ |!|to |!|_____. |!|- |!|correct |!|answer |!| ✔ ACH, |!|NCSLA When |!|does |!|surplus |!|lines |!|tax |!|not |!|apply? |!|- |!|correct |!|answer |!| ✔ For |!|state |!|government |!|agencies |!| or |!|local |!|government |!|risk |!|pools.