Free Accident/Sickness Agent Practice Questions

Sample Practice Questions

Try these 10 sample questions from the Accident/Sickness Agent practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

1. 1A self-employed consultant becomes unable to work because of illness. She wants benefits to replace her own earnings. Which disability coverage addresses that loss?

   1. A. Business overhead expense insurance
   2. B. Key-person disability insurance
   3. C. Individual disability income insurance
   4. D. Disability buy-sell insurance

   Answer: C

   Explanation: NAIC describes disability insurance as providing "income if a worker is unable to perform their job duties and earn money due to a disability." The consultant needs replacement of her personal earnings, so individual disability income is the fit; the business forms address operating costs, a key worker, or an ownership buyout.

   Reference: Simplifying the Complications of Disability Insurance — Disability Insurance, opening paragraph

2. 2A producer promises to remove an exclusion from an individual accident and sickness policy. Under Georgia's entire-contract provision, whose approval is required for a valid policy change?

   1. A. The insured named in the policy contract
   2. B. An agent appointed by the issuing insurer
   3. C. An executive officer of the issuing insurer
   4. D. The Georgia Commissioner of Insurance

   Answer: C

   Explanation: Georgia's required clause states, "No change in this policy shall be valid until approved by an executive officer of the insurer and unless such approval is endorsed hereon or attached hereto." An agent's promise, an insured's request, or a regulator's general policy-form authority cannot replace that executive approval and endorsement.

   Reference: Official Code of Georgia Annotated, Title 33, Chapters 23–65 — O.C.G.A. § 33-29-3(b)(1), Entire contract; changes

3. 3A Medicare beneficiary wants coverage through a Medicare-approved private health plan that bundles hospital and medical benefits, usually with drug coverage. Which Medicare option is this?

   1. A. Original Medicare Parts A and B
   2. B. Medicare Advantage Part C
   3. C. Standalone Part D plan
   4. D. Medicare supplement policy

   Answer: B

   Explanation: Medicare.gov says Medicare Advantage is also Part C and "These “bundled” plans include Part A, Part B, and usually Part D." Original Medicare itself is A and B; a standalone drug plan or Medigap serves a different role.

   Reference: Parts of Medicare — Parts of Medicare, Medicare Advantage (Part C)

4. 4Which stated purpose of Georgia's group coordination-of-benefits rule specifically addresses claim-payment timing?

   1. A. Reduce duplication of benefits
   2. B. Establish an order in which plans pay claims
   3. C. Make COB contracts consistent with the regulation
   4. D. Reduce claims-payment delays

   Answer: D

   Explanation: Rule 120-2-48-.02 expressly lists reducing claims-payment delays as a purpose. It also facilitates information transfer rather than prohibiting it. Official text: “Reduce claims payments delays”

   Reference: GA R&R - GAC - Subject 120-2-48 GROUP COORDINATION OF BENEFITS — Rule 120-2-48-.02(e)

5. 5Which application-completion practice best reduces fraud risk in a Georgia long-term care replacement?

   1. A. Answer all material application questions truthfully and completely
   2. B. Omit relevant facts to obtain a lower rate
   3. C. Sign the form before answers are entered
   4. D. Let the producer invent missing answers

   Answer: A

   Explanation: Georgia's replacement notice directs applicants to answer application questions truthfully and completely and warns of claim consequences for material omissions. Official text: “truthfully and completely answer all questions on the application concerning your medical health history.”

   Reference: GA R&R - GAC - Subject 120-2-16 LONG TERM CARE INSURANCE — Rule 120-2-16-.14, replacement notice

6. 6Which Georgia Insurance Department section is assigned insurance-company regulatory oversight, including granting or denying applications for certificates of authority?

   1. A. Regulatory Services Section
   2. B. Consumer Services Section
   3. C. Agents Licensing Section
   4. D. Fire Safety Education Section

   Answer: A

   Explanation: Georgia Rule 120-2-1-.04(1) states that the Regulatory Services Section provides insurance company regulatory oversight and directs it to grant or deny certificate-of-authority applications. Official text: “Grant or deny applications for certificates of authority.”

   Reference: GA R&R - GAC - Subject 120-2-1 ORGANIZATION — Rule 120-2-1-.04(1)(a)

7. 7Which factor is not one of the four bases Georgia Rule 120-2-8-.11(1) bars for Medicare supplement pricing during open enrollment?

   1. A. Health status
   2. B. Claims experience
   3. C. The applicant's preferred premium-payment mode
   4. D. Receipt of health care

   Answer: C

   Explanation: The rule lists health status, claims experience, receipt of health care, and medical condition; it does not list a preferred premium-payment mode. Official text: “because of the health status, claims experience, receipt of health care, or medical condition”

   Reference: GA R&R - GAC - Subject 120-2-8 MEDICARE SUPPLEMENT INSURANCE — Rule 120-2-8-.11(1)

8. 8A small practice owner is disabled. The practice needs help paying rent, utilities, and staff wages while the owner recovers. Which coverage serves that purpose?

   1. A. Business overhead expense insurance
   2. B. Individual disability income insurance
   3. C. Disability buy-sell insurance
   4. D. Group disability income insurance

   Answer: A

   Explanation: NAIC says this provision covers "standard business expenses such as payroll, utilities, rent, etc., while the business owner recovers from a disability." Those are the owner's ongoing business expenses. Personal and group disability income protect earnings, while buy-sell coverage funds an ownership transfer.

   Reference: Small Business Insurance — Disability Insurance, business overhead paragraph

9. 9An individual accident and sickness policy has been in force for more than two years. A new covered loss begins after that period, and the application contained a nonfraudulent misstatement. Which time limit governs using that misstatement to void the policy or deny this claim?

   1. A. One year from the issue date
   2. B. Two years from the issue date
   3. C. Three years from the issue date
   4. D. Five years from the issue date

   Answer: B

   Explanation: Georgia's clause says, "After two years from the date of issue of this policy and in the absence of fraud, no misstatements made by the applicant in the application for such policy shall be used to void the policy or to deny a claim" for a loss beginning after the period. The stated nonfraudulent misstatement therefore cannot support the denial.

   Reference: Official Code of Georgia Annotated, Title 33, Chapters 23–65 — O.C.G.A. § 33-29-3(b)(2)(A), Time limit on certain defenses

10. 10A client asks which joint federal and state medical-cost program can serve qualifying low-income families, pregnant people, older adults, and people with disabilities. Which program should the producer identify?

    1. A. Medicare
    2. B. Social Security Disability Insurance
    3. C. Medicaid
    4. D. Consolidated Omnibus Budget Reconciliation Act

    Answer: C

    Explanation: Medicare.gov says, "Medicaid is a joint federal and state program" helping cover medical costs for listed low-income groups. Medicare, SSDI, and COBRA have different program bases and eligibility.

    Reference: Medicaid — Medicaid, opening paragraph