South Carolina P&C Insurance Law & Regulation
The state portion of the South Carolina property and casualty exam begins with who regulates insurance in South Carolina and the consumer-protection rules that overlay the national coverage forms. This chapter covers the Department of Insurance, unfair trade practices, and the cancellation and nonrenewal protections that apply to policies delivered in the state.
The Department of Insurance (SCDOI)
South Carolina regulates insurance through the South Carolina Department of Insurance (SCDOI), led by the Director of Insurance. The department issues, denies, suspends, and revokes producer licenses, reviews policy forms and rates, investigates consumer complaints, and enforces the insurance laws (confirmed at doi.sc.gov). On the exam, remember that the Department of Insurance, not the Secretary of State or the DMV, licenses property and casualty producers.
Unfair Trade Practices and Producer Conduct
South Carolina's unfair trade practices law prohibits misrepresenting policy terms, false or misleading advertising, unfair discrimination between similar risks, defamation of an insurer, coercion, and unfair claim settlement practices. Rebating, giving any part of the premium or commission or other valuable consideration as an inducement to buy that is not stated in the policy, is prohibited. Premiums a producer collects are held in a fiduciary capacity and must not be commingled or converted. Violations can bring fines and license suspension or revocation by the department.
Cancellation and Nonrenewal Protections
South Carolina law limits how and when an insurer may cancel or nonrenew personal auto and homeowners policies and requires advance written notice so the insured can find replacement coverage. Once a policy is past its initial underwriting period, cancellation is generally allowed only for defined reasons such as nonpayment of premium or fraud. The exact notice periods are set by statute and can change; confirm the current day-counts with the South Carolina Department of Insurance before relying on a specific number.