A subcontract requires $1,000,000 per occurrence liability coverage, but the certificate shows $500,000. How much additional per occurrence limit is needed to meet the subcontract requirement?
Correct Answer
B) $500,000.
The gap is the required limit minus the shown limit: $1,000,000 - $500,000 = $500,000.
Why This Is the Correct Answer
The gap is the required limit minus the shown limit: $1,000,000 - $500,000 = $500,000.
Why the Other Options Are Wrong
Option A: $250,000.
$250,000. is below the supported result for insurance certificates; it likely omits part of the approved scope, cap, credit, or holdback.
Option C: $1,000,000.
$1,000,000. is above the supported result for insurance certificates; it likely adds scope or money the rule does not allow.
Option D: $1,500,000.
$1,500,000. is above the supported result for insurance certificates; it likely adds scope or money the rule does not allow.
Memory Technique
Insurance Certificates gate for Checking Subcontractor'S: paper opens before money moves.
Reference Hint
Study anchor (closed-book): memorize Insurance certificates from CSLB 2026 Law Book; California insurance and contractor risk. / CSLB Law Book insurance and business risk management; know the rule or calculation trigger without relying on exam-room lookup.
More Law & Business Questions
A Fresno homeowner wants a $725 cabinet repair and trim adjustment. Which contract step best matches CA home improvement requirements?
A project has $6,500 retainage withheld. The owner releases 60 percent of retainage at substantial completion. How much cash is released?
Cash is $52,500 and monthly burn is $17,500. How many months of runway are available?
A supplier offers 1.5 percent early-pay discount on a $22,000 invoice. What is the discount?
A balance sheet lists assets of $310,000 and liabilities of $185,000. What is owner's equity?
A job is estimated to cost $135,000. What price gives a 25 percent gross margin?
A customer invoice of $4,000 has a stated late charge of 1.5 percent. What late charge is added?
A bid has direct labor of $18,000, materials of $12,500, and equipment rental of $3,500. If the contractor adds 20 percent markup on direct cost, what is the bid price?
A contractor wants a 25 percent gross margin on a job with estimated cost of $60,000. What selling price gives that margin?
A completed project sold for $150,000 and had total cost of $126,000. What gross margin percentage did the project earn?
People Also Study
Related Study Resources
Previous Question
A cabinet allowance is $9,500. The owner selects a package costing $10,275, with no markup on allowance overages. What adjustment is needed?
Next Question
The drywall stocking worksheet shows a unit-price change adds 58 square feet of drywall repair at $47 per square foot. What amount should be added?