The correct answer is b).
Federal covered advisers include those who
manage client assets of $25,000,000 or more or who
advises only mutual funds. A federal covered adviser
is also one who is excluded from the definition of
an investment adviser under the Investment Advisers
Act of 1940 (including those who give advice solely
on US Government securities. However, those who advise
only insurance companies are not defined as federal
covered advisers, since insurance companies are only
regulated at the state level, not federal.