18 Free North Carolina Accident and Health Exam Practice Questions (2026)
How to Use This Accident and Health Question Set
North Carolina's Accident and Health or Sickness Agent exam is one of two separate Pearson VUE exams required for a Life & Health license — the other being the Life Agent exam. It has 55 scored questions (plus up to 5 unscored pretest questions mixed in unlabeled), a 75-minute time limit, and a $45 fee per attempt. Passing is a scaled score of 70 on a 0-100 scale, not a raw percentage.
Content outline #123415, effective March 2, 2026, splits the 55 items as: Accident and Health Insurance Policies (22, broken down inside the outline as disability income 7, basic medical 2, major medical 6, comprehensive 1, hospital indemnity 1 and managed care 5), North Carolina Statutes and Regulations Pertinent to Accident and Health (14), Accident and Health Insurance Policy Provisions (11), and Other Accident and Health Topics (8). Policies alone are 40% of the exam, and disability income is the largest single piece inside that section.
These 18 questions come from chapters 4, 5 and 6 of LanePrep's North Carolina Life & Health quiz bank, in roughly that proportion: eight on accident and health policies, five on the provisions that govern a policy once it is in force, and five on other A&H topics and North Carolina's A&H-specific statutes. Each question shows its chapter, so a miss tells you exactly which audio lesson to replay.
North Carolina has not required a pre-licensing course since October 1, 2025 (Session Law 2025-45 repealed the old 20-hour requirement). The Accident and Health exam is the easier of North Carolina's two producer exams by the NAIC's numbers — first-time pass rates run 61-63% for 2024-2025, against 51-55% for the Life Agent exam — but "easier" is relative, not low-stakes, and it still fails roughly two in five first-time candidates.
Work them before you read the answer. Every question has the explanation folded underneath it. Guessing and then reading is worth more than reading and then agreeing.
Practice Questions 1-8: Accident and Health Insurance Policies
This is the largest section of the exam, and it leans on disability-income definitions, the arithmetic of a comprehensive major medical plan, and the structural differences between HMOs, PPOs, basic medical and hospital indemnity coverage.
Question 1 (Chapter 4)
A policyholder suffers the total loss of sight in both eyes due to an accident. The disability policy immediately begins paying benefits without requiring the insured to satisfy an elimination period. This is an example of:
- A) Residual disability
- B) Partial disability
- C) Probationary period
- D) Presumptive disability
Show answer & explanation
Answer: D
Presumptive disability provisions define specific severe conditions (loss of sight, hearing, speech, or two limbs) as automatically qualifying for total disability benefits, waiving the elimination period.
Question 2 (Chapter 4)
Which of the following best describes the purpose of a 'corridor deductible' in a comprehensive major medical plan?
- A) It is the amount paid by the insurer before the basic medical plan kicks in.
- B) It is a deductible that applies only to emergency room visits.
- C) It is a penalty for using out-of-network providers.
- D) It is the amount the insured must pay after basic medical benefits are exhausted but before major medical coverage begins.
Show answer & explanation
Answer: D
In comprehensive plans that combine basic medical and major medical, the corridor deductible is the gap the insured must pay after the basic medical limits are reached and before the major medical coverage starts paying.
Question 3 (Chapter 4)
A major medical policy has a $500 deductible and 80/20 coinsurance. If the insured incurs $5,500 in covered expenses, how much will the insurer pay?
- A) $4,400
- B) $4,500
- C) $5,000
- D) $4,000
Show answer & explanation
Answer: D
First, subtract the deductible: $5,500 - $500 = $5,000. The insurer pays 80% of the remaining $5,000, which is $4,000.
Question 4 (Chapter 4)
An HMO member requires a referral from their primary care physician (PCP) to see a specialist. What is the role of the PCP in this scenario?
- A) Gatekeeper
- B) Independent contractor
- C) Utilization reviewer
- D) Claims adjuster
Show answer & explanation
Answer: A
In an HMO, the primary care physician acts as a 'gatekeeper,' managing the member's healthcare and controlling costs by requiring referrals before the member can see a specialist.
Question 5 (Chapter 4)
What is the primary purpose of the 'stop-loss' feature in a major medical policy?
- A) To limit the total amount of premiums the insured pays.
- B) To prevent the insurer from canceling the policy.
- C) To cap the total lifetime benefit of the policy.
- D) To limit the amount of out-of-pocket expenses the insured must pay for coinsurance.
Show answer & explanation
Answer: D
The stop-loss feature (often called the out-of-pocket maximum) protects the insured by capping the amount they must pay for coinsurance during a policy period.
Question 6 (Chapter 4)
Residual disability benefits are designed to pay:
- A) Benefits when the insured returns to work but suffers a loss of income due to the disability.
- B) A fixed amount regardless of income loss.
- C) Benefits only for the first month after returning to work.
- D) A lump sum for permanent impairment.
Show answer & explanation
Answer: A
Residual disability benefits provide partial income replacement when an insured returns to work but cannot earn as much as they did before the disability, helping to bridge the income gap.
Question 7 (Chapter 4)
What happens to the deductible in a major medical plan if the policy uses a 'carryover provision'?
- A) The deductible is waived for the next year.
- B) The deductible is doubled for the next year.
- C) The insurer pays the deductible for the insured.
- D) Expenses incurred in the last three months of the year can be applied to the next year's deductible.
Show answer & explanation
Answer: D
The carryover provision allows expenses incurred during the last three months of the calendar year that were applied to the deductible to also count toward the next year's deductible.
Question 8 (Chapter 4)
Which of the following is a characteristic of 'basic medical expense' insurance?
- A) High lifetime maximum limits.
- B) High deductibles and coinsurance.
- C) Comprehensive coverage for all medical services.
- D) Low limits and first-dollar coverage.
Show answer & explanation
Answer: D
Basic medical expense policies (hospital, surgical, and regular medical) generally have low benefit limits and provide first-dollar coverage (no deductible), but they lack the broad protection of major medical insurance.
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Practice Questions 9-13: Accident and Health Insurance Policy Provisions
Eleven of the 55 items test the provisions that sit inside every individual accident and health policy: how benefits coordinate across policies, what happens to an unpaid premium at claim time, and the clauses that govern renewal and assignment.
Question 9 (Chapter 5)
A policyholder's health insurance policy includes a 'Relation of Earnings to Insurance' provision. If the insured's total disability benefits from all policies exceed their average monthly earnings, what is the effect?
- A) The insurer will pay the full amount of the claim regardless of earnings.
- B) The insurer will cancel all policies held by the insured.
- C) The insurer will pay the claim but report the insured for insurance fraud.
- D) The insurer will reduce the benefits proportionally and return a portion of the premiums paid.
Show answer & explanation
Answer: D
The 'Relation of Earnings to Insurance' provision prevents over-insurance by limiting the total disability benefits to the insured's average earnings. If benefits exceed earnings, the insurer reduces the benefit and refunds a proportionate amount of the premium.
Question 10 (Chapter 5)
A policyholder is hospitalized and wants to assign their medical benefit payments directly to the hospital. Which provision governs this action?
- A) Payment of Claims.
- B) Change of Beneficiary.
- C) Legal Actions.
- D) Assignment of Benefits.
Show answer & explanation
Answer: D
The 'Assignment' provision allows the insured to transfer their right to receive benefits to a third party, such as a hospital or doctor, ensuring the provider is paid directly.
Question 11 (Chapter 5)
An insured individual has multiple health policies with different insurers. If a loss occurs, how does the 'Other Insurance in This Insurer' provision help manage the claim?
- A) It allows the insured to collect full benefits from all policies simultaneously.
- B) It requires the insurer to cancel all other policies held by the insured.
- C) It forces the insured to choose only one policy to file the claim against.
- D) It prevents the insured from collecting more than the total amount of the loss by coordinating benefits.
Show answer & explanation
Answer: D
This provision prevents over-insurance by ensuring that if an insured has multiple policies with the same insurer, the total benefits paid do not exceed the actual loss.
Question 12 (Chapter 5)
An insured individual has a policy that is 'Optional Renewable.' What is the insurer's right regarding this policy?
- A) The insurer can cancel the policy only on the premium due date.
- B) The insurer may cancel the policy at any time for any reason.
- C) The insurer cannot cancel the policy under any circumstances.
- D) The insurer can refuse to renew the policy on any premium due date or policy anniversary.
Show answer & explanation
Answer: D
An 'Optional Renewable' policy gives the insurer the right to refuse to renew the policy on a premium due date or anniversary, providing the insurer with flexibility to discontinue coverage.
Question 13 (Chapter 5)
Under the 'Unpaid Premium' optional provision, what can the insurer do if a premium is due at the time of a claim?
- A) The insurer can deduct the unpaid premium from the claim benefit.
- B) The insurer can refuse to pay the claim until the premium is paid.
- C) The insurer must pay the claim and waive the premium.
- D) The insurer can cancel the policy immediately.
Show answer & explanation
Answer: A
The 'Unpaid Premium' provision allows the insurer to deduct any unpaid premium from the settlement of a claim, ensuring that the insurer receives the premium due for the coverage provided.
Practice Questions 14-18: Other Accident and Health Topics and North Carolina Statutes
The closing 22 items split between other A&H topics (group continuation, tax treatment, business disability coverage) and North Carolina's own A&H statutes — policy form approval, MEWA oversight and the state's incontestable-clause deadline.
Question 14 (Chapter 6)
A North Carolina resident, Michael, is covered by two group health insurance plans: one through his employer and another through his spouse's employer. Both plans include a Coordination of Benefits (COB) provision. If Michael incurs medical expenses, how will the benefits typically be coordinated between the two plans?
- A) The plan that has paid more in the past will be primary, and the other will be secondary.
- B) The plan with the higher deductible will be primary, to ensure the deductible is met first.
- C) The plan that has been in effect for a longer period will be primary.
- D) The plan covering Michael as an employee (his own employer's plan) will be primary, and the plan covering him as a dependent (his spouse's plan) will be secondary.
Show answer & explanation
Answer: D
Under standard Coordination of Benefits (COB) rules, when an individual is covered by two group plans, the plan covering the individual as an employee (their own employer's plan) is typically primary. The plan covering them as a dependent (e.g., through a spouse's employer) would then be secondary. This prevents overpayment and ensures a logical order of benefit payment.
Question 15 (Chapter 6)
A self-employed North Carolina resident, Maria, pays the premiums for her individual disability income policy with after-tax dollars. If Maria becomes disabled and begins receiving benefits from this policy, how will these benefits generally be treated for federal income tax purposes?
- A) The benefits will be fully taxable as ordinary income.
- B) The benefits will be partially taxable, depending on her income level.
- C) The premiums paid will be deductible, and the benefits will be taxable.
- D) The benefits will be tax-free.
Show answer & explanation
Answer: D
For individual disability income policies, if the policyowner pays the premiums with after-tax dollars, the benefits received are generally tax-free. If the premiums were paid with pre-tax dollars (e.g., by an employer where the premiums were a deductible business expense for the employer), the benefits would typically be taxable to the recipient. Since Maria paid with after-tax dollars, her benefits are tax-free.
Question 16 (Chapter 6)
A Multiple Employer Welfare Arrangement (MEWA) in North Carolina is formed by several small, unrelated employers to provide health benefits to their employees. Which statement accurately describes the regulatory oversight of such an arrangement in North Carolina?
- A) MEWAs are entirely exempt from state insurance regulation under federal ERISA law.
- B) MEWAs are regulated solely by the U.S. Department of Labor, with no state oversight.
- C) MEWAs are only regulated if they offer fully insured plans, not if they are self-funded.
- D) MEWAs are subject to comprehensive regulation by the North Carolina Department of Insurance (NCDOI).
Show answer & explanation
Answer: D
While federal ERISA law generally preempts state regulation for single-employer self-funded plans, MEWAs are a specific exception. MEWAs, whether fully insured or self-funded, are subject to significant state regulation, including licensure and solvency requirements, by the North Carolina Department of Insurance (NCDOI) to protect consumers and ensure financial stability. This is a critical distinction from typical ERISA plans.
Question 17 (Chapter 6)
A North Carolina business owner purchases a Business Overhead Expense (BOE) policy. If the owner becomes disabled, what expenses are specifically covered by this policy?
- A) The owner's personal salary and lost dividends.
- B) The purchase price of the business from a disabled partner.
- C) Rent, utilities, employee salaries, and other ongoing business operating expenses.
- D) The cost of hiring a permanent replacement for the business owner.
Show answer & explanation
Answer: C
A BOE policy is designed to cover the ongoing operating expenses of a business while the owner is disabled. It does not cover the owner's lost income (A), the purchase of a partner's share (B), or the cost of a permanent replacement (D).
Question 18 (Chapter 6)
Under North Carolina G.S. 58-50-35, what is the maximum time limit for an insurer to contest a health insurance policy based on misstatements in the application?
- A) 2 years.
- B) 1 year.
- C) 5 years.
- D) The policy is contestable forever.
Show answer & explanation
Answer: A
The Time Limit on Certain Defenses provision (incontestable clause) generally limits the insurer's right to contest statements in the application to 2 years from the date of issue.
The Accident and Health Mistakes That Cost Marks
Mixing up presumptive, residual and own-occupation disability definitions. Presumptive disability waives the usual proof requirement for specific severe losses (sight, hearing, speech, two limbs). Own-occupation pays if the insured can't do their specific job, even if they can work elsewhere. Residual pays a partial benefit when the insured returns to work at reduced income. The exam names all three as distractors against each other constantly.
Stopping the math at the deductible. Deductible and coinsurance are two separate steps: subtract the deductible first, then apply the coinsurance split to what remains. A stop-loss limit is a third, separate check on the insured's total out-of-pocket cost — work all three in order before answering a benefit-calculation question.
Treating a probationary period as a waiting period for accidents. A probationary period is a one-time window (often 15-30 days) after a health policy's effective date during which sickness claims specifically are not paid, to prevent someone from buying coverage only after getting sick. It does not apply to accidental injuries.
Assuming North Carolina's group continuation right matches a number from national material. North Carolina's own statute (G.S. 58-53-1 et seq.) sets an 18-month continuation right for group health coverage lost through termination or reduced hours, with the individual paying the full premium. Confirm the number against the North Carolina statute, not a generic federal figure.
Forgetting MEWAs are state-regulated, not ERISA-exempt. Federal ERISA law preempts state regulation of most single-employer self-funded plans, but Multiple Employer Welfare Arrangements are a specific exception the NCDOI regulates directly, fully insured or self-funded.
Your Next Step
How did you score?
- 15 or more correct (83%+): You are comfortably above the scaled-70 target. Book the Accident and Health exam, then read how to pass the North Carolina Life & Health exam on your first try for the week-by-week plan covering both exams.
- 12-14 correct: You are in range but close to the line. Note which chapter your misses fell in and re-listen to that chapter's audio lesson before retesting.
- Under 12 correct: Even with a friendlier first-time pass rate (61-63%) than the Life Agent exam, roughly two in five first-time candidates still fail this exam. Start with chapter 4 of the course and work forward rather than guessing through another set.
Chapters of the LanePrep North Carolina course covering accident and health are included with the full course; chapter 1 previews free, no signup. For a full-length timed run, try the practice exam. For the Life Agent exam, see the Life Agent question set; for a 25-question sample across both exams, see the free practice set.
Exam structure and fees from the NCDOI/Pearson VUE candidate guide #123400 (October 2025 edition). Question counts and content weighting from Pearson VUE content outline #123415 (effective March 2, 2026). Pass rates from the NAIC compiled pass-rate reports for 2024 and 2025. Read October 2026.
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