Evergreen Insurance Prep

North Carolina Property & Casualty Insurance License, Practice Exams

North Carolina Property & Casualty producer licensing. National P&C insurance knowledge plus North Carolina insurance law (auto, property and homeowners, workers' compensation), authored from public-domain statutes.
Content last updated 1 July 2026

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Each module is scored separately here so you know exactly where you stand. To pass the real North Carolina exam you need 70%.

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The free sample gives you about 20 questions per module. The full bank contains every question — general insurance plus state law — with written, statute-cited explanations. $49, one time, lifetime access on up to 3 devices — every state and line we add later included.

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Frequently asked questions

How is the North Carolina producer licensing exam structured?

North Carolina licenses Property & Casualty producers through Pearson VUE, requiring 70% to pass. This bank covers the national property & casualty material plus North Carolina law - auto (the current 50/100/50 minimum limits, the Reinsurance Facility and Rate Bureau), property and homeowners (the standard fire policy, the Insurance Guaranty Association and the Beach/FAIR Plan), and workers' compensation.

What score do I need to pass?

You need 70%. Practice each module to that level and run the full exam simulation before your test date.

Are these real exam questions?

No vendor publishes the live exam. Every question here is original, written to the official content outline and grounded in public-domain sources — including the North Carolina General Statutes for the state-law questions, with the statute section cited in each explanation.

How many practice questions are included?

The full North Carolina bank contains 1102 questions (general insurance plus North Carolina law), with written, source-cited explanations. The free sample gives you about 20 questions per module.

What does access cost?

$49, one time, for lifetime access — and it includes every state and line we add later, at no extra charge. No subscription.

Can I use it on more than one device?

Yes. One purchase works on up to 3 of your devices, for example your laptop, phone and tablet, so you can practise wherever you are. Your progress is saved on each device.

Do I need to create an account?

No. The practice tests run in your browser with no signup. Your score history is saved on your own device.

Sample North Carolina Property & Casualty Insurance License practice questions

A selection of free questions with answers and explanations. Use the interactive modules above for timed, scored drills.

The Business Auto physical damage coverage offers which coverage categories?

  1. Workers compensation
  2. Comprehensive, specified causes of loss, and collision ✓
  3. Uninsured motorists only
  4. Liability and medical payments

Why: BACF physical damage can be written as Comprehensive, Specified Causes of Loss (a narrower named-peril option), and Collision.

On judicial review of a cease and desist order, the Commissioner's findings as to the facts are conclusive if:

  1. They are supported by substantial evidence ✓
  2. The order has become final
  3. They are uncontested by the petitioner
  4. The court so stipulates

Why: G.S. 58-63-35(a) provides that the Commissioner's findings as to the facts, if supported by substantial evidence, are conclusive.

How does a standard commercial property deductible typically apply?

  1. It does not apply to building losses
  2. Per item with no aggregate
  3. Per occurrence, subtracted from the loss after coinsurance is applied ✓
  4. Per peril, doubling for theft

Why: The deductible applies per occurrence and is subtracted from the loss amount after any coinsurance adjustment is made.

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Under the concealment or fraud provision of the North Carolina standard fire policy, the entire policy is void if the insured willfully conceals or misrepresents a material fact:

  1. Whether done before or after a loss ✓
  2. Only if done before the loss occurs
  3. Only if the misrepresentation was in the application
  4. Only if done after the loss occurs

Why: The Concealment or fraud provision voids the entire policy for willful concealment or misrepresentation of a material fact whether before or after a loss.

An employer who WILLFULLY fails to secure the payment of compensation as required by the Act is guilty of:

  1. A Class H felony ✓
  2. No crime, only a civil penalty
  3. An infraction only
  4. A Class 1 misdemeanor

Why: G.S. 97-94(c) provides that an employer who willfully fails to secure the payment of compensation is guilty of a Class H felony.

Which statement about strict liability is TRUE?

  1. It applies only to employer-employee relationships
  2. It requires intent to harm
  3. Fault need not be proven; liability attaches due to the nature of the activity ✓
  4. The plaintiff must prove the defendant was careless

Why: Strict liability imposes responsibility without requiring proof of negligence, based on the inherently dangerous nature of the activity or product defect.

Which endorsement would increase the Coverage C limit available for items used in a home business beyond the small special limit?

  1. Inflation guard
  2. Personal injury endorsement
  3. Mortgage clause
  4. A home business / permitted incidental occupancy or business property endorsement ✓

Why: Because business property on premises has a low special limit, a home business or permitted incidental occupancy endorsement is used to increase business property and add appropriate liability.

The Joint Ownership Coverage endorsement is used when a PAP needs to cover:

  1. A leased fleet of vehicles
  2. Individuals who are not married but jointly own a covered auto (or non-resident relatives) ✓
  3. A vehicle owned by a corporation
  4. A vehicle used as a livery

Why: Joint ownership coverage adapts the PAP for vehicles owned by two or more individuals not married to each other, or by an individual and one or more relatives who don't all reside together.

When recommending a particular service or source for the repair of property damage, an insurance producer, adjuster, or appraiser must:

  1. Clearly inform the claimant that the claimant is under no obligation to use the recommended repair service ✓
  2. Obtain the insurer's written approval first unless an exception clearly applies for the coverage that is in force
  3. Provide at least three competing estimates
  4. Charge no fee for the recommendation

Why: G.S. 58-33-76(a) requires clearly informing the claimant that the claimant is under no obligation to use the recommended repair service.

Under farm property coverage, livestock such as cattle and horses are usually covered:

  1. Only while in transit by ocean
  2. For all causes of loss with no limits
  3. On a named-peril basis (e.g., death by lightning, accidental shooting), often with per-animal limits ✓
  4. Under the dwelling coverage

Why: Farm livestock is typically insured on a named-peril basis (lightning, fire, certain accidents) and is frequently subject to per-animal and aggregate limits.

Under the schedule of injuries, compensation for the loss of a hand is 66 2/3% of average weekly wages for how many weeks?

  1. 200 weeks ✓
  2. 240 weeks
  3. 144 weeks
  4. 120 weeks

Why: G.S. 97-31(12) provides 66 2/3% of average weekly wages during 200 weeks for the loss of a hand.

In a death claim, persons wholly dependent on the deceased employee's earnings at the time of the accident are:

  1. Limited to the surviving spouse
  2. Paid only after partial dependents are paid
  3. Entitled to receive the entire compensation, share and share alike, to the exclusion of others ✓
  4. Paid a fixed lump sum regardless of wages

Why: G.S. 97-38(1) gives persons wholly dependent the entire compensation share and share alike, to the exclusion of all others.

For serious facial or head disfigurement, the Industrial Commission may award equitable compensation not to exceed what amount?

  1. No maximum
  2. $30,000
  3. $10,000
  4. $20,000 ✓

Why: G.S. 97-31(21) authorizes the Commission to award proper and equitable compensation not to exceed $20,000 for serious facial or head disfigurement.

Under the SDIP, an at-fault accident causing only property damage of $2,300 or less is classified as a:

  1. Non-chargeable accident in all cases
  2. Minor accident ✓
  3. Major accident
  4. Intermediate accident

Why: N.C. Gen. Stat. §58-36-75(a) defines a "minor accident" as an at-fault accident resulting in only property damage of $2,300 or less. Property damage over $2,300 but under $3,850 is an intermediate accident.

A resident producer wants to add the property line of authority to an existing license. Under G.S. 58-33-125(c), the fee due upon application for that additional kind of insurance is:

  1. $20.00
  2. $11.00
  3. $100.00
  4. $50.00 ✓

Why: G.S. 58-33-125(c) requires a fee of fifty dollars ($50.00) for each additional kind of insurance requested.

Under the standard fire policy, if loss is payable to a designated mortgagee and the insured fails to render proof of loss, the mortgagee must render proof of loss within how many days after notice?

  1. 90 days
  2. 60 days ✓
  3. 45 days
  4. 30 days

Why: The mortgagee provision requires the mortgagee, upon notice, to render proof of loss within 60 days after the insured's failure to do so.

Under North Carolina's UIM statute, a highway vehicle is "underinsured" when:

  1. The at-fault driver was cited for a moving violation
  2. The claimant did not purchase collision coverage
  3. It carries no liability insurance at all
  4. The sum of the applicable bodily injury liability limits is less than the total damages the claimant sustained ✓

Why: N.C. Gen. Stat. §20-279.21(b)(4) defines an "underinsured highway vehicle" as one for which the sum of the applicable bodily injury liability limits at the time of the accident is less than the total damages sustained by the person seeking UIM benefits.

Under G.S. 58-33-46, willfully overinsuring property is:

  1. Only a civil matter between insurer and insured in that particular circumstance
  2. Permitted if the insured consents
  3. Not addressed by the licensing statute
  4. A ground for probation, suspension, revocation, or nonrenewal of a license ✓

Why: G.S. 58-33-46(a)(16) lists willfully overinsuring property as a ground for disciplinary action.

A farmowners-ranchowners policy is best described as a package that combines:

  1. Crop insurance only
  2. Property and liability coverage for the farm dwelling, farm structures, and farming operations ✓
  3. Auto coverage only
  4. Only farm liability

Why: The farmowners-ranchowners policy is a package combining homeowners-type property and liability coverage with coverage for farm structures, equipment, and operations.

In a monopolistic state fund jurisdiction, employers must generally obtain workers' compensation coverage from:

  1. A federal program
  2. Any private insurer licensed in the state
  3. An out-of-state surplus lines insurer
  4. The state-operated fund only ✓

Why: In monopolistic fund states, the state fund is the sole source of WC coverage and private insurers may not write it; employers must buy from the state fund.

An employee is injured in a car crash while driving between two job sites during the workday as part of assigned duties. This injury most likely is:

  1. Compensable because it arose out of and in the course of employment ✓
  2. Not compensable because it occurred while driving
  3. Covered by the employee's personal auto policy exclusively
  4. Compensable only under Part Two

Why: Travel that is part of the job's duties (not merely commuting) generally arises out of and in the course of employment and is compensable under workers' compensation.

Under the appraisal provision of the standard fire policy, after a written demand for appraisal, each party must select a competent and disinterested appraiser and notify the other within:

  1. 30 days after the demand
  2. 10 days after the demand
  3. 15 days after the demand
  4. 20 days after the demand ✓

Why: The Appraisal provision requires each party to select an appraiser and notify the other of the selection within 20 days after the demand.

Which document in a CPP contains information common to all coverage parts, such as the named insured, policy period, and premium?

  1. Interline endorsement
  2. Common Policy Declarations ✓
  3. Coverage Part Declarations
  4. Causes of Loss form

Why: The Common Policy Declarations identify the named insured, mailing address, policy period, business description, and the coverage parts that apply.

A neighbor is injured by the insured's dog and incurs medical bills. Even though no lawsuit is filed and fault is unclear, payment may be available under:

  1. Coverage E — Personal Liability
  2. Coverage F — Medical Payments to Others ✓
  3. Coverage C — Personal Property
  4. Coverage D — Loss of Use

Why: Coverage F pays reasonable medical expenses for injured third parties on a no-fault, goodwill basis without requiring a finding of legal liability.

Transportation expenses coverage under PAP Part D typically reimburses the insured for:

  1. Rental/temporary transportation costs after a covered loss, subject to a daily and total maximum ✓
  2. Lost wages while the car is repaired
  3. Towing on every breakdown
  4. The full value of a rental car indefinitely

Why: Transportation expenses coverage pays temporary transportation (e.g., rental) costs following a covered Part D loss, subject to per-day and per-occurrence limits.

The principle that allows insurers to predict losses more accurately as the number of similar exposure units increases is the:

  1. Principle of indemnity
  2. Law of agency
  3. Law of large numbers ✓
  4. Doctrine of reasonable expectations

Why: The law of large numbers states that the larger the number of similar exposures, the more predictable actual loss experience becomes.

For purposes of determining the number of appointments for an insurance producer, there shall be one appointment for:

  1. Each insurer the producer represents
  2. Each policy the producer places
  3. Each line of authority for which the appointed producer is licensed, unless specifically limited ✓
  4. Each county in which the producer writes business unless an exception clearly applies for the coverage that is in force

Why: G.S. 58-33-40(b) provides that there shall be one appointment for each line of authority for which the appointed producer is licensed, unless specifically limited.

Under the FCRA, before an insurer obtains an investigative consumer report on an applicant, it must:

  1. Notify FEMA
  2. Get a court order
  3. Cancel any existing policy
  4. Clearly and accurately disclose to the consumer that such a report may be obtained ✓

Why: The FCRA requires advance written disclosure to the consumer that an investigative consumer report may be requested, along with a description of the consumer's rights.

Under §58-41-15, failure to send the cancellation notice to a designated mortgagee or loss payee:

  1. Has no legal effect at all
  2. Automatically extends the policy one year
  3. Voids the cancellation entirely as to everyone
  4. Invalidates the cancellation only as to the mortgagee's or loss payee's interest ✓

Why: Section 58-41-15(b) provides that failure to send the notice to a designated mortgagee or loss payee invalidates the cancellation only as to that party's interest.

In the Dwelling Policy, which coverage applies to a detached garage or storage shed?

  1. Coverage B — Other Structures ✓
  2. Coverage C — Personal Property
  3. Coverage A — Dwelling
  4. Coverage D — Fair Rental Value

Why: Coverage B — Other Structures covers structures separated from the dwelling, such as detached garages, sheds, and fences.