1
NC Life Insurance Exam 2025 –
Comprehensive Questions with Verified
Correct Answers and Complete Solutions
(100% Accurate)
Section 1: Insurance Regulations and Commissioner Duties
(20 Questions)
1. Which of the following is NOT a duty of the North Carolina Insurance Commissioner?
a. Conducting investigations of domestic insurers
b. Reviewing insurers’ annual reports
c. Writing North Carolina insurance laws
d. Reporting violations to the Attorney General
c. Writing North Carolina insurance laws
The Insurance Commissioner enforces insurance laws but does not write them; this is
the responsibility of the state legislature.
2. What is the minimum age requirement to be licensed as an insurance agent in North
Carolina?
a. 16
b. 18
c. 21
d. 25
b. 18
North Carolina requires insurance agents to be at least 18 years old to obtain a
license.
3. An agent who signs a blank insurance application is guilty of what?
a. Felony
b. Misdemeanor
c. Civil infraction
d. No offense
b. Misdemeanor
Signing a blank insurance application is considered a misdemeanor in North
Carolina due to the potential for fraud.
4. Which entity primarily regulates the insurance industry in North Carolina?
a. Federal government
b. State government
c. Insurance companies
d. National Association of Insurance Commissioners
b. State government
, 2
The insurance industry is primarily regulated by the state, with the North Carolina
Department of Insurance overseeing compliance.
5. What must an agent deliver to a policyowner when selling an individual life insurance
policy in North Carolina?
a. A copy of the agent’s license
b. A policy summary and buyer’s guide
c. A financial statement of the insurer
d. A list of all available policies
b. A policy summary and buyer’s guide
North Carolina requires agents to provide a policy summary and buyer’s guide to
ensure transparency.
6. Which of the following actions is considered an unfair trade practice?
a. Sharing commissions with licensed agents
b. Forcing a client to buy insurance from a specific lender
c. Providing accurate policy comparisons
d. Offering discounts for early premium payments
b. Forcing a client to buy insurance from a specific lender
Coercion, such as requiring insurance purchase from a specific lender, is an unfair
trade practice in North Carolina.
7. What is the purpose of the North Carolina Life and Health Insurance Guaranty
Association?
a. To regulate insurance premiums
b. To assist in preventing insurer insolvencies
c. To set underwriting standards
d. To license insurance agents
b. To assist in preventing insurer insolvencies
The Guaranty Association protects policyholders by ensuring benefits are paid if an
insurer becomes insolvent.
8. If a licensee terminates residency in North Carolina, what must they do?
a. Pay a termination fee
b. Deliver the license to the Commissioner within 30 days
c. Complete additional continuing education
d. Notify clients within 60 days
b. Deliver the license to the Commissioner within 30 days
A licensee must surrender their license to the Commissioner within 30 days of
terminating residency.
9. Which of the following is an example of a deceptive practice?
a. Providing accurate policy information
b. Circulating false statements about an insurer’s financial condition
c. Offering a free consultation
d. Explaining policy exclusions clearly
b. Circulating false statements about an insurer’s financial condition
Circulating false or derogatory statements about an insurer’s financial condition is
considered a deceptive practice.
, 3
10. What is required to complete a life insurance application in North Carolina?
a. A medical exam for all applicants
b. The signature of the proposed adult insured
c. A copy of the agent’s license
d. A notarized affidavit
b. The signature of the proposed adult insured
An incomplete application missing the adult insured’s signature is invalid in North
Carolina.
11. How often must insurance agents renew their licenses in North Carolina?
a. Annually
b. Every two years
c. Every three years
d. Every four years
b. Every two years
North Carolina insurance licenses must be renewed every two years.
12. What is the penalty for rebating in North Carolina?
a. No penalty
b. License suspension or revocation
c. A fine of $100
d. Community service
b. License suspension or revocation
Rebating, or offering unauthorized incentives, can lead to license suspension or
revocation.
13. What must an insurer provide when requesting written proof of loss?
a. A police report
b. A blank form for the claim
c. A financial statement
d. A premium refund
b. A blank form for the claim
Insurers must provide a blank form for proof of loss to facilitate the claims process.
14. Which of the following is NOT regulated by the North Carolina Department of
Insurance?
a. Insurance agent licensing
b. Policy provisions
c. Federal tax laws
d. Unfair trade practices
c. Federal tax laws
Federal tax laws are regulated by the IRS, not the North Carolina Department of
Insurance.
15. What is required to reinstate a lapsed life insurance policy?
a. Payment of back premiums only
b. Proof of insurability
c. A new medical exam only
d. No requirements
b. Proof of insurability
NC Life Insurance Exam 2025 –
Comprehensive Questions with Verified
Correct Answers and Complete Solutions
(100% Accurate)
Section 1: Insurance Regulations and Commissioner Duties
(20 Questions)
1. Which of the following is NOT a duty of the North Carolina Insurance Commissioner?
a. Conducting investigations of domestic insurers
b. Reviewing insurers’ annual reports
c. Writing North Carolina insurance laws
d. Reporting violations to the Attorney General
c. Writing North Carolina insurance laws
The Insurance Commissioner enforces insurance laws but does not write them; this is
the responsibility of the state legislature.
2. What is the minimum age requirement to be licensed as an insurance agent in North
Carolina?
a. 16
b. 18
c. 21
d. 25
b. 18
North Carolina requires insurance agents to be at least 18 years old to obtain a
license.
3. An agent who signs a blank insurance application is guilty of what?
a. Felony
b. Misdemeanor
c. Civil infraction
d. No offense
b. Misdemeanor
Signing a blank insurance application is considered a misdemeanor in North
Carolina due to the potential for fraud.
4. Which entity primarily regulates the insurance industry in North Carolina?
a. Federal government
b. State government
c. Insurance companies
d. National Association of Insurance Commissioners
b. State government
, 2
The insurance industry is primarily regulated by the state, with the North Carolina
Department of Insurance overseeing compliance.
5. What must an agent deliver to a policyowner when selling an individual life insurance
policy in North Carolina?
a. A copy of the agent’s license
b. A policy summary and buyer’s guide
c. A financial statement of the insurer
d. A list of all available policies
b. A policy summary and buyer’s guide
North Carolina requires agents to provide a policy summary and buyer’s guide to
ensure transparency.
6. Which of the following actions is considered an unfair trade practice?
a. Sharing commissions with licensed agents
b. Forcing a client to buy insurance from a specific lender
c. Providing accurate policy comparisons
d. Offering discounts for early premium payments
b. Forcing a client to buy insurance from a specific lender
Coercion, such as requiring insurance purchase from a specific lender, is an unfair
trade practice in North Carolina.
7. What is the purpose of the North Carolina Life and Health Insurance Guaranty
Association?
a. To regulate insurance premiums
b. To assist in preventing insurer insolvencies
c. To set underwriting standards
d. To license insurance agents
b. To assist in preventing insurer insolvencies
The Guaranty Association protects policyholders by ensuring benefits are paid if an
insurer becomes insolvent.
8. If a licensee terminates residency in North Carolina, what must they do?
a. Pay a termination fee
b. Deliver the license to the Commissioner within 30 days
c. Complete additional continuing education
d. Notify clients within 60 days
b. Deliver the license to the Commissioner within 30 days
A licensee must surrender their license to the Commissioner within 30 days of
terminating residency.
9. Which of the following is an example of a deceptive practice?
a. Providing accurate policy information
b. Circulating false statements about an insurer’s financial condition
c. Offering a free consultation
d. Explaining policy exclusions clearly
b. Circulating false statements about an insurer’s financial condition
Circulating false or derogatory statements about an insurer’s financial condition is
considered a deceptive practice.
, 3
10. What is required to complete a life insurance application in North Carolina?
a. A medical exam for all applicants
b. The signature of the proposed adult insured
c. A copy of the agent’s license
d. A notarized affidavit
b. The signature of the proposed adult insured
An incomplete application missing the adult insured’s signature is invalid in North
Carolina.
11. How often must insurance agents renew their licenses in North Carolina?
a. Annually
b. Every two years
c. Every three years
d. Every four years
b. Every two years
North Carolina insurance licenses must be renewed every two years.
12. What is the penalty for rebating in North Carolina?
a. No penalty
b. License suspension or revocation
c. A fine of $100
d. Community service
b. License suspension or revocation
Rebating, or offering unauthorized incentives, can lead to license suspension or
revocation.
13. What must an insurer provide when requesting written proof of loss?
a. A police report
b. A blank form for the claim
c. A financial statement
d. A premium refund
b. A blank form for the claim
Insurers must provide a blank form for proof of loss to facilitate the claims process.
14. Which of the following is NOT regulated by the North Carolina Department of
Insurance?
a. Insurance agent licensing
b. Policy provisions
c. Federal tax laws
d. Unfair trade practices
c. Federal tax laws
Federal tax laws are regulated by the IRS, not the North Carolina Department of
Insurance.
15. What is required to reinstate a lapsed life insurance policy?
a. Payment of back premiums only
b. Proof of insurability
c. A new medical exam only
d. No requirements
b. Proof of insurability
