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NORTH CAROLINA HEALTH INSURANCE
EXAM QUESTIONS WITH DETAILED
VERIFIED ANSWERS
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 Ans: 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 Ans: B.
Which of the following is true regarding inpatient hospital care for HMO
members?
A. Inpatient hospital care is not part of HMO services
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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 Ans: 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
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 Ans: 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 Ans: 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 Ans: B.
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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 Ans: 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
C. 60 days
D. 10 days Ans: 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 Ans: 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
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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 Ans: 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 Ans: 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
D. The insured has the right to renew the policy for the life of the
contract Ans: 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
NORTH CAROLINA HEALTH INSURANCE
EXAM QUESTIONS WITH DETAILED
VERIFIED ANSWERS
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 Ans: 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 Ans: B.
Which of the following is true regarding inpatient hospital care for HMO
members?
A. Inpatient hospital care is not part of HMO services
, Page | 2
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 Ans: 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
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 Ans: 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 Ans: 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 Ans: B.
, Page | 3
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 Ans: 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
C. 60 days
D. 10 days Ans: 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 Ans: 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
, Page | 4
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 Ans: 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 Ans: 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
D. The insured has the right to renew the policy for the life of the
contract Ans: 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
