South Carolina Personal Lines Practice Exam

Who is considered a named insured in an insurance policy?

1. Relatives who do not live with the named insured

2. Any non-relative resident under the care of the named insured

3. Full-time students over the age of 24

4. Residents under the age of 21 who are relatives of the named insured

The correct answer is: Residents under the age of 21 who are relatives of the named insured

In an insurance policy, the term "named insured" specifically refers to the individual or entity explicitly identified in the policy as the insured party. This person or entity holds the rights and benefits outlined in the policy. Residents under the age of 21 who are relatives of the named insured are included as insured individuals under the policy, provided they live in the same household as the named insured. This inclusion is important because it extends coverage and protections to those residing with the primary insured, reflecting the understanding that they share a living environment and thus share similar risks. This makes option D correct, as it highlights the relationship and the residence requirement that qualifies these individuals to be considered as part of the insured under the primary policyholder's coverage. In contrast, other options are less applicable because they either involve individuals who do not live with the named insured or specify conditions that don't extend the named insured status, making it clear that not every relative or resident qualifies unless they meet specific criteria of being a recognized resident and relative.