1|Page
NJ Accident and Health Producer PRACTICE EXAMS (NEW UPDATED VERSION) LATEST
ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (VERIFIED QUESTIONS AND ANSWERS) |
GUARANTEED PASS
NJ HEALTH & ACCIDENT INSURANCE — PRACTICE
EXAM
QUESTIONS + ANSWERS + RATIONALES
1. What does “insurable interest” mean?
A. The insurer must have a financial stake in the insured’s well-being
B. The insured must demonstrate knowledge about the policy
C. The beneficiary must pay a higher premium
D. The policy must cover only health risks
Answer: A. The insurer must have a financial stake in the insured’s well-being
Rationale: Insurable interest exists when the policy owner would suffer financial loss if the
insured dies or becomes disabled.
2. Which of the following best describes a “beneficiary”?
A. The person who pays the premium
B. The person covered by the policy
C. The person who receives benefits
D. The insurer’s representative
Answer: C. The person who receives benefits
Rationale: A beneficiary is designated to receive policy proceeds if a covered event occurs.
3. Which type of policy pays fixed benefits regardless of actual medical expenses?
A. Indemnity policy
B. Reimbursement policy
C. Expense-incurred policy
D. Service policy
Answer: A. Indemnity policy
Rationale: Indemnity pays a set dollar amount for covered events, not based on actual cost.
2026 2027 GRADED A+
,2|Page
4. What does “premium” refer to in insurance?
A. The amount paid to a beneficiary
B. The cost of the policy paid by the insured
C. The maximum amount an insurer will pay
D. The tax deductible on health insurance
Answer: B. The cost of the policy paid by the insured
Rationale: Premiums are payments made to keep the policy in force.
5. Which provision protects the insurance company from fraud due to material
misrepresentation?
A. Grace period
B. Entire contract clause
C. Incontestability clause
D. Free look period
Answer: C. Incontestability clause
Rationale: After a specified period (usually 2 years), the insurer cannot void the contract due to
misrepresentation.
6. What is a deductible?
A. The amount the insurer pays before the insured pays
B. The amount the insured pays before coverage begins
C. The monthly premium cost
D. The benefit limit
Answer: B. The amount the insured pays before coverage begins
Rationale: Deductibles are cost-sharing amounts the insured must satisfy before benefits apply.
7. Which type of health insurance plan requires referrals to see specialists?
A. HMO (Health Maintenance Organization)
B. PPO (Preferred Provider Organization)
C. POS (Point of Service)
D. Indemnity plan
2026 2027 GRADED A+
, 3|Page
Answer: A. HMO (Health Maintenance Organization)
Rationale: HMOs require a primary care physician referral for specialists.
8. A “coinsurance” clause typically requires the insured to pay what?
A. A flat fee per visit
B. A percentage of costs after the deductible
C. The full cost of services
D. No cost after the deductible
Answer: B. A percentage of costs after the deductible
Rationale: Coinsurance splits costs between insurer and insured after the deductible is met.
9. What is the primary purpose of the New Jersey Comprehensive Health Insurance Pool (NJ
CHIP)?
A. To regulate premiums for healthy individuals
B. To provide coverage for individuals who are uninsurable on the open market
C. To offer discounts to large employers
D. To act as a reinsurance provider for Medicare
Answer: B. To provide coverage for individuals who are uninsurable on the open market
Rationale: Pools offer coverage options for those denied standard policies due to health
conditions.
10. What does an exclusion in a health policy do?
A. Increases the premium
B. Limits the age of coverage
C. Lists conditions not covered
D. Allows coverage of all illnesses
Answer: C. Lists conditions not covered
Rationale: Exclusions specify what is not covered under the policy.
11. In NJ, what must an agent do before selling a health insurance policy?
A. Ensure the applicant is over age 50
B. Explain the policy terms clearly
2026 2027 GRADED A+
NJ Accident and Health Producer PRACTICE EXAMS (NEW UPDATED VERSION) LATEST
ACTUAL EXAM QUESTIONS AND CORRECT ANSWERS (VERIFIED QUESTIONS AND ANSWERS) |
GUARANTEED PASS
NJ HEALTH & ACCIDENT INSURANCE — PRACTICE
EXAM
QUESTIONS + ANSWERS + RATIONALES
1. What does “insurable interest” mean?
A. The insurer must have a financial stake in the insured’s well-being
B. The insured must demonstrate knowledge about the policy
C. The beneficiary must pay a higher premium
D. The policy must cover only health risks
Answer: A. The insurer must have a financial stake in the insured’s well-being
Rationale: Insurable interest exists when the policy owner would suffer financial loss if the
insured dies or becomes disabled.
2. Which of the following best describes a “beneficiary”?
A. The person who pays the premium
B. The person covered by the policy
C. The person who receives benefits
D. The insurer’s representative
Answer: C. The person who receives benefits
Rationale: A beneficiary is designated to receive policy proceeds if a covered event occurs.
3. Which type of policy pays fixed benefits regardless of actual medical expenses?
A. Indemnity policy
B. Reimbursement policy
C. Expense-incurred policy
D. Service policy
Answer: A. Indemnity policy
Rationale: Indemnity pays a set dollar amount for covered events, not based on actual cost.
2026 2027 GRADED A+
,2|Page
4. What does “premium” refer to in insurance?
A. The amount paid to a beneficiary
B. The cost of the policy paid by the insured
C. The maximum amount an insurer will pay
D. The tax deductible on health insurance
Answer: B. The cost of the policy paid by the insured
Rationale: Premiums are payments made to keep the policy in force.
5. Which provision protects the insurance company from fraud due to material
misrepresentation?
A. Grace period
B. Entire contract clause
C. Incontestability clause
D. Free look period
Answer: C. Incontestability clause
Rationale: After a specified period (usually 2 years), the insurer cannot void the contract due to
misrepresentation.
6. What is a deductible?
A. The amount the insurer pays before the insured pays
B. The amount the insured pays before coverage begins
C. The monthly premium cost
D. The benefit limit
Answer: B. The amount the insured pays before coverage begins
Rationale: Deductibles are cost-sharing amounts the insured must satisfy before benefits apply.
7. Which type of health insurance plan requires referrals to see specialists?
A. HMO (Health Maintenance Organization)
B. PPO (Preferred Provider Organization)
C. POS (Point of Service)
D. Indemnity plan
2026 2027 GRADED A+
, 3|Page
Answer: A. HMO (Health Maintenance Organization)
Rationale: HMOs require a primary care physician referral for specialists.
8. A “coinsurance” clause typically requires the insured to pay what?
A. A flat fee per visit
B. A percentage of costs after the deductible
C. The full cost of services
D. No cost after the deductible
Answer: B. A percentage of costs after the deductible
Rationale: Coinsurance splits costs between insurer and insured after the deductible is met.
9. What is the primary purpose of the New Jersey Comprehensive Health Insurance Pool (NJ
CHIP)?
A. To regulate premiums for healthy individuals
B. To provide coverage for individuals who are uninsurable on the open market
C. To offer discounts to large employers
D. To act as a reinsurance provider for Medicare
Answer: B. To provide coverage for individuals who are uninsurable on the open market
Rationale: Pools offer coverage options for those denied standard policies due to health
conditions.
10. What does an exclusion in a health policy do?
A. Increases the premium
B. Limits the age of coverage
C. Lists conditions not covered
D. Allows coverage of all illnesses
Answer: C. Lists conditions not covered
Rationale: Exclusions specify what is not covered under the policy.
11. In NJ, what must an agent do before selling a health insurance policy?
A. Ensure the applicant is over age 50
B. Explain the policy terms clearly
2026 2027 GRADED A+
