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Free Health Insurance License Examination Practice Questions

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Sample Practice Questions

Try these 10 sample questions from the Health Insurance License Examination practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

  1. 1A client has an accident-only health policy and needs treatment after an unforeseen fall. Which loss fits the policy's cause-of-loss trigger?

    1. A. Treatment for an injury from the fall
    2. B. Treatment for a bacterial infection
    3. C. Treatment for a congenital condition
    4. D. Treatment for a degenerative condition

    Answer: A

    Explanation: "caused by or necessitated as a result of accident or specified kinds of accidents" The fall is an accident; the other three losses arise from sickness or nonaccidental conditions.

    Reference: NAIC Glossary of Insurance Terms — Glossary, Accident Only or AD&D

  2. 2A disabled employee can work fewer hours but earns less than before the injury. Which disability-income benefit addresses the reduced earnings?

    1. A. Total disability benefit
    2. B. Recurrent disability benefit
    3. C. Residual disability benefit
    4. D. Delayed disability benefit

    Answer: C

    Explanation: "This coverage fills the gap in income if you are partially disabled, resulting in reduced income." Residual benefits address partial disability with reduced income; the other categories involve different disability states or timing.

    Reference: NAIC Simplifying the Complications of Disability Insurance — Residual Benefit(s) paragraph

  3. 3A producer explains who owns a stock insurance company. Which group has that ownership interest?

    1. A. The company's policyholders
    2. B. The fraternal society's members
    3. C. The cooperative's subscribers
    4. D. The company's stockholders

    Answer: D

    Explanation: "Stock Insurance Company - business owned by stockholders." Stockholders own a stock insurer. The other groups correspond to different organizational arrangements.

    Reference: NAIC Glossary of Insurance Terms — Glossary, Stock Insurance Company

  4. 4An individual Kentucky expense-incurred health policyholder has a newborn child. When does the child's statutory health coverage begin?

    1. A. On the date 31 days after the birth
    2. B. On the child's date and time of birth
    3. C. On the first policy anniversary date
    4. D. On approval of the child's application

    Answer: B

    Explanation: "born child of the insured from the moment of birth." The statute starts newborn coverage at birth. A possible 31-day notice and premium requirement concerns continuation, not initial onset.

    Reference: Kentucky Revised Statutes KRS 304.17-042 — KRS 304.17-042(1)

  5. 5A Kentucky health policy contains the optional change-of-occupation clause. After issue, the insured moves to an insurer-classified more hazardous job and is injured. How is indemnity determined?

    1. A. At the original indemnity amount stated for the former occupation
    2. B. By reducing the premium and refunding the unearned difference
    3. C. As the paid premium would buy at the more hazardous occupation's rate
    4. D. By paying the insurer's standard benefit for any occupation

    Answer: C

    Explanation: "indemnities provided in this policy as the premium paid would have purchased at the rate and within the limits fixed by the insurer for such more hazardous occupation." For the more hazardous occupation, the clause scales indemnity to the coverage purchasable at that hazard's rate. A premium reduction and refund belongs to the less hazardous case.

    Reference: Kentucky Revised Statutes KRS 304.17-190 — KRS 304.17-190, Change of Occupation

  6. 6An insurer asks a consumer reporting agency to issue a report containing an applicant's medical information for underwriting. Whose permission is needed before the agency issues it?

    1. A. The attending physician's permission
    2. B. The insurance applicant's permission
    3. C. The producer's supervisor's permission
    4. D. The insurer's claims officer's permission

    Answer: B

    Explanation: "you must get the applicant’s permission before the CRA can issue the report." The FCRA prerequisite is the applicant's permission; approval by another insurance participant cannot substitute for it.

    Reference: FTC Consumer Reports: What Insurers Need to Know — Getting and Using Medical Information

  7. 7A dental policy separates preventive from restorative services. How should a routine dental cleaning generally be classified?

    1. A. Restorative care
    2. B. Endodontic care
    3. C. Oral surgery
    4. D. Preventive care

    Answer: D

    Explanation: "preventative care (cleaning, routine office visits); restorative care (fillings and crowns)" A routine cleaning is preventive. Fillings and crowns are restorative; endodontics and oral surgery are different service classes.

    Reference: NAIC Understanding Your Dental Insurance — What Dental Plans Cover

  8. 8An LTC policy uses the common two-ADL, 90-day benefit trigger described in the NAIC guide. Which functional limitation meets that trigger?

    1. A. Needs human help with one ADL for 90 days
    2. B. Needs human help with two ADLs for 30 days
    3. C. Needs human help with one ADL for 30 days
    4. D. Needs human help with two ADLs for 90 days

    Answer: D

    Explanation: "unable to do two ADLs without human assistance for 90 days." The described trigger requires both two activities of daily living and 90 days. Each other choice misses the count or duration.

    Reference: NAIC A Shopper's Guide to Long-Term Care Insurance — Types of Benefit Triggers, Activities of Daily Living

  9. 9Assume each person meets the age and dependency rules. Which coverage arrangement generally permits an HSA contribution?

    1. A. An HDHP with an ordinary non-HDHP medical plan
    2. B. An HDHP with no disqualifying other health coverage
    3. C. A non-HDHP plan without high-deductible coverage
    4. D. Medicare enrollment with a separate HDHP plan

    Answer: B

    Explanation: "You are covered under a high deductible health plan (HDHP), described later, on the first day of the month. You have no other health coverage except what is permitted under Other health coverage, later. You aren’t enrolled in Medicare." An eligible contributor needs HDHP coverage, no disqualifying other coverage, and no Medicare enrollment. Each alternative violates one of those conditions.

    Reference: IRS Publication 969, Health Savings Accounts — Qualifying for an HSA Contribution

  10. 10A Kentucky health producer offers an applicant shares of stock for buying a policy. Which prohibited-inducement category describes the offer?

    1. A. Employment
    2. B. Shares of stock or other securities
    3. C. An advisory board contract
    4. D. Special returns or special dividends

    Answer: B

    Explanation: The stock offer is prohibited. The statute bars offering as an inducement “any shares of stock or other securities.”

    Reference: Krs 304 12 110 — KRS 304.12-110

Topics in this practice bank

These topics describe the available practice for Health Insurance License Examination. Review the examination outline and its sources for scope and allocation details.

  • Types of Health Insurance Policies
    • Contract and Policy Terminology
    • General Categories of Health Policies
    • Accident Policies
    • Definition of Accident
    • Accident Benefits
    • Dismemberment
    • Capital and Principal Sums
    • Accidental Death Benefit
    • Multiple Indemnity
    • Accidental Means
    • Accidental Death Time Limits
  • Disability Income Insurance
    • Function of Disability Income Insurance
    • Individual versus Group Coverage
    • Financial Planning Considerations
    • Alternatives to Disability Income Insurance
    • Basic Disability Income Provisions
    • Defining Total Disability
    • Probationary Period
    • Elimination Period
    • Benefit Periods
    • Benefit Amounts
    • Confining versus Nonconfining Disability
    • Other Disability Concepts
    • Partial Disability
    • Residual Disability
    • Recurrent Disability
    • Delayed Disability
    • Combined Accident and Sickness Disabilities
    • Nondisabling Injuries
    • Optional Short-Term Benefits
    • Rehabilitation Benefit
    • Disability Insurance Refund Provisions
    • Return of Premium
    • Cash Surrender Value
    • Business Uses
    • Key Person Disability
    • Business Overhead Expense
    • Reducing Term Disability
    • Disability Buy-Sell
  • Medical Expense Insurance
    • Basic Expense Insurance
    • Individual versus Group Coverage
    • Hospital Expense Benefits
    • Room and Board Benefit
    • Miscellaneous Medical Expenses Benefit
    • Surgical Expense Benefits
    • Scheduled Plan
    • Nonscheduled Plan
    • Regular Medical Expense Benefits
    • Other Medical Expense Benefits
    • Maternity Benefits
    • Emergency First-Aid Coverage
    • Mental Infirmity
    • Common Exclusions and Limitations
    • Major Medical Coverage
    • Comprehensive Major Medical Benefits
    • Supplemental Major Medical Benefits
    • Covered Expenses
    • Other Major Medical Concepts
    • Deductible Features
    • Benefit Periods and Inside Limits
    • Restoration of Benefits
  • Health Insurance Providers
    • Traditional Insurers
    • Stocks and Mutual Companies
    • Fraternals
    • Consumer Cooperatives
    • Participating and Nonparticipating Policies
    • Domestic, Foreign, and Alien Companies
    • Authorized/Admitted and Unauthorized/Nonadmitted Companies
    • Health Maintenance Organizations (HMOs)
    • Preferred Provider Organizations (PPOs)
    • Point-of-Service Plans
  • Common Provisions and Features
    • Insuring Clause
    • Consideration Clause
    • Benefits Payment Provision
    • Free-Look Provision
    • Assignment
    • Accumulations
    • Policy Continuation
    • Optionally and Conditionally Renewable Policies
    • Cancelable Policies
    • Guaranteed Renewable Policies
    • Noncancelable Policies
    • Term Policies
    • Nonoccupational versus Full Coverage Policies
    • Case Management Provisions
    • Dependents’ Rights in Family Policies
    • Conversion to an Individual Policy
    • Newborn Children
    • Physical and Mental Handicaps
    • Riders and Endorsements
    • Multiple Indemnity Rider
    • Waiver of Premium Rider
    • Hospital Confinement Rider
    • Impairment Rider
    • Guaranteed Insurability Rider
    • Cost of Living Adjustment
    • Social Security Rider
    • Lifetime Extension Rider
  • Required Uniform Policy Provisions
    • Required Provision 1: Entire Contract; Changes
    • Required Provision 2: Time Limit on Certain Defenses – Incontestability
    • Required Provision 3: Grace Period
    • Required Provision 4: Reinstatement
    • Required Provision 5: Notice of Claim
    • Required Provision 6: Claim Forms
    • Required Provision 7: Proof of Loss
    • Required Provision 8: Time of Payment of Claims
    • Required Provision 9: Payment of Claims
    • Required Provision 10: Physical Examination and Autopsy
    • Required Provision 11: Legal Actions
    • Required Provision 12: Change of Beneficiary
  • Optional Uniform Policy Provisions
    • Optional Provision 1: Change of Occupation
    • Optional Provision 2: Misstatement of Age
    • Optional Provision 3: Other Insurance in this Insurer
    • Optional Provisions 4 and 5: Insurance with other Insurers
    • Optional Provision 6: Relation of Earnings to Insurance – Average Earnings Clause
    • Optional Provision 7: Unpaid Premium
    • Optional Provision 8: Cancellation
    • Optional Provision 9: Conformity with State Statutes
    • Optional Provision 10: Illegal Occupation
    • Optional Provision 11: Narcotics
  • The Application and Underwriting
    • Application Defined
    • Relationship of the Application to the Policy
    • Importance of the Application
    • Correcting Applications
    • Representations and Warranties
    • Concealment
    • Executing Agreements
    • Conditional Receipt
    • Agent Responsibilities
    • Policy Replacement
    • Obtaining Additional Underwriting Information
    • Inspection Reports
    • Medical Reports
    • Medical Information Bureau (MIB)
    • Fair Credit Reporting Act
    • Information and Privacy Protection Acts
    • Risk Classification
    • Commonly Used Factors
    • Three Major Risk Types
    • Occupational Hazards
    • AIDS Considerations
    • Substandard Risks
    • Preferred Risks
    • Premium Payments
    • Definition of Premium
    • Earned and Unearned Premium
    • Payment Modes
    • Initial Premium
    • Policy Effective Date
    • Policy Term
    • Policy Fee
    • Factors in Premium Computation
    • Types of Reserves
    • Reinsurance
  • Group Health Insurance
    • The Nature of Group Coverage
    • Master Policy and Policyowner
    • Group Risk Selection
    • Eligibility and Eligibility Period
    • Adverse Selection
    • Benefit Provisions
    • Establishing a Group Plan
    • Contributory and Noncontributory Plans
    • Certificates of Insurance
    • Group Premium Rating Factors
    • Group Policy Types
    • Group Coverage Provisions
    • Coordination of Benefits Provision
    • Continuation and Conversion Privileges
    • Plan Termination
    • COBRA and Employees’ Dependents
    • Group Insurance Plan Regulations
    • Age Discrimination in Employment Act
    • The Americans with Disabilities Act (ADA)
    • Pregnancy Discrimination
    • The Employee Retirement Income Security Act (ERISA)
    • Portability of Coverage
    • Group Health Insurance Funding Alternatives
    • Self-Insured Funds
    • 501(c)(9) Trusts
    • Third-Party Administrators and Administrative Services Only
    • Other Forms of Group Insurance
    • Blanket Policies
    • Franchise Policies
    • Multiple Employer Trusts (METs)
    • Multiple Employer Welfare Associations (MEWAs)
    • Taft-Hartley Trusts
    • Individual versus Group Insurance
  • Special Types of Health Policies
    • Dental Care Insurance
    • Basic Coverages
    • Exclusions and Limitations
    • Minimizing Adverse Selection
    • Limited Policies
    • Dread Disease
    • Travel Accident Insurance
    • Hospital Income (Indemnity) Insurance
    • Vision Care Insurance
    • Prescription Drug Policies
    • Credit Insurance
  • Long-Term Care (LTC) Insurance
    • Common Provisions
    • Benefit Triggers
    • Marketing LTC Coverage
    • Long-Term Care Partnership Program
  • Social Health Insurance
    • Medicare
    • Eligibility
    • Enrollment
    • Benefits Under Medicare Part A
    • What Part A does not Cover
    • Benefits Under Medicare Part B
    • What Part B does not Cover
    • Claims and Appeals
    • Medicare Supplement Insurance
    • Standard Medicare Supplement Benefits
    • Core Benefits
    • Optional Benefits
    • Standardized Policy Forms
    • Other Standard Provisions
    • Medicare Part C: Medicare Advantage
    • Medicare Part D: Prescription Drug Plan
    • Plans K and L
    • Medicare and Employer Coverage
    • Medicaid
    • Financial Tests
    • Spousal Impoverishment Rule
    • Medicare Cost Assistance
    • Social Security Disability
    • TRICARE
    • Workers' Compensation
    • Types of Benefits
    • Compensable Injuries
    • Occupational Diseases
    • Types of Disability
    • Compulsory and Elective Compensation Laws
    • Extraterritorial Provisions
    • Second Injury Funds
  • Health Insurance and Taxation
    • Taxation and Government Health Programs
    • Medicare
    • Social Security Disability Benefits
    • Taxation and Nongovernmental Plans
    • Individual Policies
    • Group Policies
    • Sole Proprietorships and Partnerships
    • Business Policies
    • Health Savings Accounts (HSAs)
  • Code & Regulations Kentucky Law
    • KRS 304.12-110
    • KRS 304.14-150
    • KRS 304.2-120
    • KRS 304.9-295
    • KRS 304.9-425(5)
    • KRS 304.9-440
    • KRS 304.42
    • 806 KAR 17:081 Sec. 3
    • 806 KAR 17:081 Sec.10

How to use these free practice questions

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These are independent study questions, not actual examination items. For examination requirements and official information, view Health Insurance License Examination details.