Life & Health study guide
Life & Health · Work through your exam, one topic at a time.
The Life & Health Insurance Producer License Examination is the combined licensing test that a candidate must pass before applying for a state-issued producer (agent) license to sell life insurance, health insurance, or both. It is designed for new entrants to the insurance business - career changers, agency hires, bank and call-center staff, and independent agents adding lines - as well as for currently licensed producers who are adding a line of authority. The Life & Health study guide has 12 sections and about 4,162 words.
01Insurance Regulation and Licensing
Insurance is regulated primarily by the states. The McCarran-Ferguson Act (1945) ceded regulation to the states, so the NAIC is not a regulator - it drafts model laws and model regulations that states may adopt in whole, in part, or not at all.
336 words, about 2 min02General Insurance Concepts and Principles
Risk is uncertainty about loss. A peril is the cause of loss (fire, illness, death).
350 words, about 2 min03Life Insurance Basics
The producer begins underwriting: complete the application (Part 1 general/business, Part 2 medical), obtain signatures, collect the initial premium, and deliver required disclosures - MIB, HIPAA privacy notice, Fair Credit Reporting Act notice, and state replacement forms. The completed application with premium is the offer ; policy issuance is the acceptance .
327 words, about 2 min04Life Insurance Policy Types and Features
Term provides pure protection with no cash value. Level term keeps a fixed face amount; decreasing term matches a shrinking need such as a mortgage; increasing term rises over time; annually renewable term (ART) has a rising premium each year.
358 words, about 2 min05Life Insurance Policy Provisions, Options, and Riders
The entire contract clause limits the agreement to the policy plus the application. The grace period (commonly 30 or 31 days) keeps coverage in force after a missed premium.
339 words, about 2 min06Annuities
An annuity is the opposite of life insurance: it liquidates an estate. During accumulation , the contract builds value (accumulation units in a variable annuity).
318 words, about 2 min07Federal Tax Considerations for Life Insurance and Annuities
Death proceeds paid to a named beneficiary are generally received income tax free . Inside buildup of cash value is tax deferred and is not taxed unless the policy is surrendered, lapses, or is a modified endowment contract.
378 words, about 2 min08Health Insurance Basics
Health underwriting uses morbidity (rates of sickness and injury) rather than mortality. Insurers manage adverse selection through eligibility rules, waiting periods, and underwriting.
306 words, about 2 min09Health Insurance Policy Provisions and Clauses
States require a standard set of provisions, drawn from NAIC models. Candidates should recognize each: Entire contract - the policy and attached endorsements comprise the agreement; only an authorized officer may change it.
372 words, about 2 min10Disability Income and Long-Term Care Coverage
Disability income replaces a portion of earned income, typically 50–70%, because over-insurance invites malingering. Definitions of disability drive claims: own occupation (cannot perform the duties of your own occupation - broader, often limited to 2 years) versus any occupation (cannot perform any job for which reasonably suited).
350 words, about 2 min11Medical Expense, Group, and Government-Sponsored Health Coverage
Individual medical may be comprehensive major medical or a high-deductible health plan paired with a health savings account : tax-deductible contributions, tax-free growth, and tax-free qualified withdrawals, available only with a qualifying HDHP. Flexible spending accounts and health reimbursement arrangements are employer-funded or employee-funded companions.
359 words, about 2 min12Other Health Coverages and Related Concepts
Dental and vision plans typically use fee schedules or networks, waiting periods for major services, and annual maximums. Prescription drug plans use tiers, formularies, and copays.
369 words, about 2 min