NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
When Linda suffered a broken hip, she notified her agent, in writing, within 12 days of the loss.
However, her agent did not notify the insurance company until 60 days after the loss. Which of the
following statements correctly explains how this claim would be handled?
A. The insurer is considered to be notified since the notification to agent equals notification to the
insurer
B. The insurer may delay the payment of this claim for up to 6 months
C. The insurer may settle this claim for less than it otherwise would have had the notification been
provided in a timely manner
D. The insurer may deny the claim since it was not notified within the required 20 day time frame -
(ANSWER)A.
While repairing the roof of his house an insured accidentally falls off and breaks his arm and sustains a
head injury that results in total blindness of both eyes. His policy contains an Accidental Death &
Dismemberment Rider. What is the extent of benefits that he will receive?
A. Reciprocal Amount
B. Principal Sum
C. Capital Sum
D. 50% of the Principal - (ANSWER)B.
Which of the following is true regarding inpatient hospital care for HMO members?
A. Inpatient hospital care is not part of HMO services
B. Care can be provided outside of the service area
C. Can can only be provided in the service area
D. Services for treatment of mental disorders are unlimited - (ANSWER)B.
As it pertains to group health insurance, the continuation provision stipulates that
A. Terminated employees may convert to an individual policy only upon proof of insurability
B. Group coverage must be extended for terminated employees up to a certain period of time at the
employers expense
,NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
C. Group coverage must be extended for terminated employees up to a certain period of time at the
employees expense
D. Retiring employees must be allowed to convert their group coverage to individual policies -
(ANSWER)C.
All of the following apply to short term disability plans EXCEPT
A. Individual plans can provide benefit periods of up to 2 years
B. A benefit period of 26 weeks is most common for group plans
C. Both group and individual plans are renewable
D. Group plans can provide benefit periods of up to 52 weeks - (ANSWER)C.
Which describes the features of a comprehensive major medical policy?
A. There is no coinsurance
B. Basic medical expense benefits are provided in single package
C. The deductible is always expressed as a deferred amount
D. It is the same as major medical insurance - (ANSWER)B.
If an insurer accepts premium payments by credit card, who is responsible for paying the fees charged
by a credit card company?
A. Credit card company
B. Insurer accepting payment
C. Policy owners, as part of premium
D. Insured - (ANSWER)B.
When a disabled dependent child reaches the age limit for coverage, how long does the policyowner
have to provide proof of dependency in order for the dependent to remain covered under the policy?
A. 15 days
B. 31 days
,NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
C. 60 days
D. 10 days - (ANSWER)B.
If a licensee is convicted of a criminal violation , the licensees insurance license is?
A. Suspended after hearing
B. Automatically suspended
C. Automatically revoked
D. Not affected - (ANSWER)B.
All of the following are differences between Individual and group health insurance EXCEPT
A. In individual policies, the individual selects coverage options, while in a group plan all employees are
covered for the same coverage which is chosen by employer
B. Individual coverage can be written on an occupation or no occupational basis
C. Individual policies are renewable, while group terminates when the individual leaves
D. Individual insurance does not require medical examinations, while group insurance does not require
medical examinations - (ANSWER)D.
A licensee decides to terminate his residency in the state. Which of the following would be an
appropriate action?
A. Delivering the license to the commissioner within 30 days
B. Allowing the license to expire
C. Notifying the NAIC
D. Notifying the commissioner within 10 days - (ANSWER)A.
Which of the following is not a feature of a noncancelable policy?
A. The insurer may terminate the contract only at renewal for certain conditions
B. The premiums cannot be increased beyond the amount stated in the policy
C. The guarantee to renew coverage usually applies until the insured reaches certain age
, NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
D. The insured has the right to renew the policy for the life of the contract - (ANSWER)A.
Which of the following must an insurer obtain in order to transact insurance within a given state?
A. Certificate of authority
B. Producer certificate
C. Business entity license
D. Insurers license - (ANSWER)A.
Group health insurance is characterized by all of the following except
A. A master contract
B. Lower administrative costs
C. Conversion privilege
D. Adverse selection - (ANSWER)D.
A hospital indemnity policy will pay
A. A benefit for each day the insured is in the hospital
B. Income lost while the insured is in the hospital
C. All expenses incurred by the stay in the hospital
D. Any expenses incurred by the stay in the hospital, minus coinsurance payments and deductibles -
(ANSWER)A.
Which of the following would qualify as a competent party in an insurance contract?
A. The applicant is a 12 year old student
B. The applicant is under the influence of a mind impairing medication at the time of the application
C. The applicant has a prior felony conviction
D. The applicant is intoxicated at the time of the application - (ANSWER)C.
ANSWERS GRADED A+
When Linda suffered a broken hip, she notified her agent, in writing, within 12 days of the loss.
However, her agent did not notify the insurance company until 60 days after the loss. Which of the
following statements correctly explains how this claim would be handled?
A. The insurer is considered to be notified since the notification to agent equals notification to the
insurer
B. The insurer may delay the payment of this claim for up to 6 months
C. The insurer may settle this claim for less than it otherwise would have had the notification been
provided in a timely manner
D. The insurer may deny the claim since it was not notified within the required 20 day time frame -
(ANSWER)A.
While repairing the roof of his house an insured accidentally falls off and breaks his arm and sustains a
head injury that results in total blindness of both eyes. His policy contains an Accidental Death &
Dismemberment Rider. What is the extent of benefits that he will receive?
A. Reciprocal Amount
B. Principal Sum
C. Capital Sum
D. 50% of the Principal - (ANSWER)B.
Which of the following is true regarding inpatient hospital care for HMO members?
A. Inpatient hospital care is not part of HMO services
B. Care can be provided outside of the service area
C. Can can only be provided in the service area
D. Services for treatment of mental disorders are unlimited - (ANSWER)B.
As it pertains to group health insurance, the continuation provision stipulates that
A. Terminated employees may convert to an individual policy only upon proof of insurability
B. Group coverage must be extended for terminated employees up to a certain period of time at the
employers expense
,NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
C. Group coverage must be extended for terminated employees up to a certain period of time at the
employees expense
D. Retiring employees must be allowed to convert their group coverage to individual policies -
(ANSWER)C.
All of the following apply to short term disability plans EXCEPT
A. Individual plans can provide benefit periods of up to 2 years
B. A benefit period of 26 weeks is most common for group plans
C. Both group and individual plans are renewable
D. Group plans can provide benefit periods of up to 52 weeks - (ANSWER)C.
Which describes the features of a comprehensive major medical policy?
A. There is no coinsurance
B. Basic medical expense benefits are provided in single package
C. The deductible is always expressed as a deferred amount
D. It is the same as major medical insurance - (ANSWER)B.
If an insurer accepts premium payments by credit card, who is responsible for paying the fees charged
by a credit card company?
A. Credit card company
B. Insurer accepting payment
C. Policy owners, as part of premium
D. Insured - (ANSWER)B.
When a disabled dependent child reaches the age limit for coverage, how long does the policyowner
have to provide proof of dependency in order for the dependent to remain covered under the policy?
A. 15 days
B. 31 days
,NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
C. 60 days
D. 10 days - (ANSWER)B.
If a licensee is convicted of a criminal violation , the licensees insurance license is?
A. Suspended after hearing
B. Automatically suspended
C. Automatically revoked
D. Not affected - (ANSWER)B.
All of the following are differences between Individual and group health insurance EXCEPT
A. In individual policies, the individual selects coverage options, while in a group plan all employees are
covered for the same coverage which is chosen by employer
B. Individual coverage can be written on an occupation or no occupational basis
C. Individual policies are renewable, while group terminates when the individual leaves
D. Individual insurance does not require medical examinations, while group insurance does not require
medical examinations - (ANSWER)D.
A licensee decides to terminate his residency in the state. Which of the following would be an
appropriate action?
A. Delivering the license to the commissioner within 30 days
B. Allowing the license to expire
C. Notifying the NAIC
D. Notifying the commissioner within 10 days - (ANSWER)A.
Which of the following is not a feature of a noncancelable policy?
A. The insurer may terminate the contract only at renewal for certain conditions
B. The premiums cannot be increased beyond the amount stated in the policy
C. The guarantee to renew coverage usually applies until the insured reaches certain age
, NORTH CAROLINA HEALTH INSURANCE TEST PAPER 2025/2026 QUESTIONS AND
ANSWERS GRADED A+
D. The insured has the right to renew the policy for the life of the contract - (ANSWER)A.
Which of the following must an insurer obtain in order to transact insurance within a given state?
A. Certificate of authority
B. Producer certificate
C. Business entity license
D. Insurers license - (ANSWER)A.
Group health insurance is characterized by all of the following except
A. A master contract
B. Lower administrative costs
C. Conversion privilege
D. Adverse selection - (ANSWER)D.
A hospital indemnity policy will pay
A. A benefit for each day the insured is in the hospital
B. Income lost while the insured is in the hospital
C. All expenses incurred by the stay in the hospital
D. Any expenses incurred by the stay in the hospital, minus coinsurance payments and deductibles -
(ANSWER)A.
Which of the following would qualify as a competent party in an insurance contract?
A. The applicant is a 12 year old student
B. The applicant is under the influence of a mind impairing medication at the time of the application
C. The applicant has a prior felony conviction
D. The applicant is intoxicated at the time of the application - (ANSWER)C.
