A contract requires a $2,000,000 aggregate limit, and the subcontractor's policy shows $1,500,000. What is the shortfall?
Correct Answer
C) $500,000.
The shortfall is $2,000,000 minus $1,500,000, or $500,000.
Why This Is the Correct Answer
The shortfall is $2,000,000 minus $1,500,000, or $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 B: $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.
Option D: $3,500,000.
$3,500,000. is above the supported result for insurance certificates; it likely adds scope or money the rule does not allow.
Memory Technique
Shortfall before dollars; dollars before balance in Comparing Requirements.
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.
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