Life and Health Insurance Examination is a licensing exam conducted in each state of United States of America for licensing of life and health insurance agents. This exam is conducted by the state department of insurance and is administered by Thompson Prometric.
The prerequisites for taking this exam vary from state to state. Most of the states require candidates to have gone through pre-licensure education from an approved institution. There is no necessity of having a professional degree in insurance for taking this exam. Background checks and fingerprinting are conducted before the exam through local law enforcement.
The test typically covers following content areas-
Insurance regulation: – Licensing requirements, State regulations, Federal regulations
General insurance: – Concepts, Insurers, Agents and general rules of agency, Contracts.
Life insurance basics: – Insurable interest, Personal uses of life insurance, Determining amount of personal life insurance, Business uses of life insurance, Classes of life insurance policies, Premiums, Agent responsibilities, Individual writing by the insurer.
Life insurance policies: – Term life insurance, Whole life insurance, Flexible premium policies, Group life insurance, Credit life insurance, Nature of variable life insurance.
Life insurance policy provisions, options and riders: – Required provisions, Other provisions, Beneficiaries, Settlement options, Non forfeiture options, Policy loan and withdrawal options, Dividend options, Disability riders, Accelerated (living) benefit provision/rider, Riders covering additional insureds, Riders affecting the death benefit amount.
Annuities: – Annuity principles and concepts, Immediate versus deferred annuities, Annuity (benefit) payment options, Annuity products, Uses of annuities.
Federal tax considerations for life insurance and annuities: – Taxation of personal life insurance, Modified endowment contracts (MECs), Taxation of non-qualified annuities, Taxation of individual retirement annuities (IRAs), Rollovers and transfers, Section 1035 exchanges.
Qualified plans: – General requirements, Federal tax considerations, Plan types, characteristics and purchasers.
Health insurance basics: – Definitions of perils, Principal types of losses and benefits, Classes of health insurance policies, Limited policies, Common exclusions from coverage, Agent responsibilities in individual health insurance, Individual underwriting by the insurer, Considerations in replacing health insurance.
Individual health insurance policy general provisions: – Required standard provisions, Other provisions, Other general provisions, Prohibited policy provisions.
Disability income and related insurance: – Qualifying for disability benefits, Individual disability income insurance, Unique aspects of individual disability underwriting, Group disability income insurance, Business disability insurance, Social Security disability.
Medical plans: – Medical plan concepts, Types of providers and plans, Cost containment in health care delivery, State requirements (individual and group), HIPAA (Health Insurance Portability and Accountability Act) requirements, Special savings plans, Health insurance risk pool.
Health maintenance organizations: – HMOs and cost control; HMO and other medical plans compared; HMO services and general provisions; HMO certification and regulation.
Group health insurance: – Characteristics of group insurance, Types of eligible groups, Marketing considerations, Employer group health insurance, Small employer medical plans.
Dental insurance: – Types of dental treatment, Indemnity plans, Employer group dental expense.
Insurance for senior citizens and special needs individuals: – Medicare, Medicare supplements, Other options for individuals with Medicare, Long-term care (LTC) insurance.
Federal tax considerations for health insurance: – Personally-owned health insurance, Employer group health insurance, Medical expense coverage for sole proprietors and partners, Business disability insurance, Special Savings Plans.
Additional considerations for life and health insurance counselors: – Duties of financial services professionals, Economic considerations in personal finance, Common financial needs and objectives of clients, Insurance purchase decisions, Income tax planning, Retirement considerations, Estate planning, Arranging life insurance, Texas community property rights in life insurance.
The content outline presented above is as adopted in Texas. The content of life and health insurance exam in other states may have slight differences.
There are 150 questions in this exam. The test is administered in 2 hours and 30 minutes time. The questions are of multiple choice types.
The test score is proportional to number of questions answered correctly. An examinee requires attempting approximately 70 percent of questions right to pass this licensing examination.
The appointment for written exam as well as fingerprinting are made at Prometric centers in most of the states. The registration process and agencies responsible for it, may be different in different states.
In Texas, cost for life and health insurance exam is $75. The fee for fingerprinting is $44.20. These fees may be different in other states.