NJ Accident and Health
Producer Exam
1. What is the primary purpose of the New Jersey Life and Health Insurance
Guaranty Association?
A. To approve new insurance policies
B. To regulate insurance premium rates
C. To protect policyholders in case of insurer insolvency
D. To investigate fraudulent claims
Answer: C. To protect policyholders in case of insurer insolvency
Explanation: The Guaranty Association provides protection to policyholders if an
insurance company becomes insolvent.
2. Which of the following would NOT be considered a limited policy?
A. Cancer policy
B. Hospital indemnity plan
C. Major medical insurance
D. Accidental death and dismemberment insurance
Answer: C. Major medical insurance
Explanation: Major medical is comprehensive; the others are limited/specific
coverage policies.
3. In New Jersey, how long is the free look period for individual health insurance
policies?
A. 10 days
B. 20 days
C. 15 days
D. 30 days
Answer: A. 10 days
,Explanation: Policyholders have 10 days to review and cancel the policy for a full
refund.
4. What is coinsurance in a health insurance policy?
A. The amount paid by the employer
B. The fixed amount paid for each service
C. A percentage of costs shared by the insured after the deductible
D. The total premium paid monthly
Answer: C. A percentage of costs shared by the insured after the deductible
Explanation: Coinsurance is the cost-sharing between insurer and insured after the
deductible is met (e.g., 80/20).
5. What type of policy would pay income to a disabled insured who cannot work?
A. Major medical insurance
B. Disability income insurance
C. Long-term care insurance
D. Workers’ compensation insurance
Answer: B. Disability income insurance
Explanation: This policy provides periodic payments to replace lost income due to
disability.
6. Which of the following would most likely be covered by a long-term care policy?
A. Cosmetic surgery
B. Private hospital room
C. Skilled nursing facility care
D. Emergency room treatment
Answer: C. Skilled nursing facility care
Explanation: Long-term care policies cover extended services like nursing home care
and home health assistance.
,7. In New Jersey, what is the continuing education (CE) requirement for producers
every licensing period?
A. 12 hours
B. 15 hours
C. 24 hours
D. 30 hours
Answer: C. 24 hours
Explanation: Producers must complete 24 CE hours biennially, including 3 hours of
ethics.
8. What is the grace period for a monthly premium payment in a health insurance
policy?
A. 7 days
B. 10 days
C. 15 days
D. 31 days
Answer: C. 10 days
Explanation: Monthly premium grace periods in health insurance are typically 10
days.
9. Under HIPAA, a person with prior creditable coverage cannot be subject to a pre-
existing condition exclusion for more than:
A. 3 months
B. 6 months
C. 12 months
D. 18 months
Answer: C. 12 months
, Explanation: HIPAA limits pre-existing condition exclusions to 12 months (or 18 for
late enrollees).
10. A policy that pays a fixed, pre-established amount for each day the insured is
hospitalized is called:
A. Hospital indemnity policy
B. Major medical policy
C. PPO plan
D. Medicare Supplement plan
Answer: A. Hospital indemnity policy
Explanation: These policies pay a daily benefit regardless of actual hospital costs.11.
Which of the following is true about a noncancelable health insurance policy?
A. The insurer can cancel the policy at any time with notice
B. Premiums may increase based on the insured's claims
C. The insurer cannot cancel or raise premiums until a certain age
D. It covers only accidental injuries
Answer: C. The insurer cannot cancel or raise premiums until a certain age
Explanation: A noncancelable policy guarantees renewability and locks in the
premium until a specified age.
12. What provision allows an insured to transfer their rights under a policy to
another person?
A. Assignment
B. Waiver
C. Coordination of benefits
D. Conversion
Answer: A. Assignment
Explanation: Assignment allows policy ownership or benefit rights to be transferred
to another party.
Producer Exam
1. What is the primary purpose of the New Jersey Life and Health Insurance
Guaranty Association?
A. To approve new insurance policies
B. To regulate insurance premium rates
C. To protect policyholders in case of insurer insolvency
D. To investigate fraudulent claims
Answer: C. To protect policyholders in case of insurer insolvency
Explanation: The Guaranty Association provides protection to policyholders if an
insurance company becomes insolvent.
2. Which of the following would NOT be considered a limited policy?
A. Cancer policy
B. Hospital indemnity plan
C. Major medical insurance
D. Accidental death and dismemberment insurance
Answer: C. Major medical insurance
Explanation: Major medical is comprehensive; the others are limited/specific
coverage policies.
3. In New Jersey, how long is the free look period for individual health insurance
policies?
A. 10 days
B. 20 days
C. 15 days
D. 30 days
Answer: A. 10 days
,Explanation: Policyholders have 10 days to review and cancel the policy for a full
refund.
4. What is coinsurance in a health insurance policy?
A. The amount paid by the employer
B. The fixed amount paid for each service
C. A percentage of costs shared by the insured after the deductible
D. The total premium paid monthly
Answer: C. A percentage of costs shared by the insured after the deductible
Explanation: Coinsurance is the cost-sharing between insurer and insured after the
deductible is met (e.g., 80/20).
5. What type of policy would pay income to a disabled insured who cannot work?
A. Major medical insurance
B. Disability income insurance
C. Long-term care insurance
D. Workers’ compensation insurance
Answer: B. Disability income insurance
Explanation: This policy provides periodic payments to replace lost income due to
disability.
6. Which of the following would most likely be covered by a long-term care policy?
A. Cosmetic surgery
B. Private hospital room
C. Skilled nursing facility care
D. Emergency room treatment
Answer: C. Skilled nursing facility care
Explanation: Long-term care policies cover extended services like nursing home care
and home health assistance.
,7. In New Jersey, what is the continuing education (CE) requirement for producers
every licensing period?
A. 12 hours
B. 15 hours
C. 24 hours
D. 30 hours
Answer: C. 24 hours
Explanation: Producers must complete 24 CE hours biennially, including 3 hours of
ethics.
8. What is the grace period for a monthly premium payment in a health insurance
policy?
A. 7 days
B. 10 days
C. 15 days
D. 31 days
Answer: C. 10 days
Explanation: Monthly premium grace periods in health insurance are typically 10
days.
9. Under HIPAA, a person with prior creditable coverage cannot be subject to a pre-
existing condition exclusion for more than:
A. 3 months
B. 6 months
C. 12 months
D. 18 months
Answer: C. 12 months
, Explanation: HIPAA limits pre-existing condition exclusions to 12 months (or 18 for
late enrollees).
10. A policy that pays a fixed, pre-established amount for each day the insured is
hospitalized is called:
A. Hospital indemnity policy
B. Major medical policy
C. PPO plan
D. Medicare Supplement plan
Answer: A. Hospital indemnity policy
Explanation: These policies pay a daily benefit regardless of actual hospital costs.11.
Which of the following is true about a noncancelable health insurance policy?
A. The insurer can cancel the policy at any time with notice
B. Premiums may increase based on the insured's claims
C. The insurer cannot cancel or raise premiums until a certain age
D. It covers only accidental injuries
Answer: C. The insurer cannot cancel or raise premiums until a certain age
Explanation: A noncancelable policy guarantees renewability and locks in the
premium until a specified age.
12. What provision allows an insured to transfer their rights under a policy to
another person?
A. Assignment
B. Waiver
C. Coordination of benefits
D. Conversion
Answer: A. Assignment
Explanation: Assignment allows policy ownership or benefit rights to be transferred
to another party.
