A subcontractor has $750,000 coverage but the contract requires $1,000,000. What percent of the required limit is currently shown?
Correct Answer
D) 75 percent.
The shown limit is $750,000 divided by the required $1,000,000, or 75 percent.
Why This Is the Correct Answer
The shown limit is $750,000 divided by the required $1,000,000, or 75 percent.
Why the Other Options Are Wrong
Option A: 25 percent.
25 percent. is below the supported result for insurance certificates; it likely omits part of the approved scope, cap, credit, or holdback.
Option B: 50 percent.
50 percent. is below the supported result for insurance certificates; it likely omits part of the approved scope, cap, credit, or holdback.
Option C: 80 percent.
80 percent. 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 Explaining Shortfall: 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.
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