Free SD Accident & Health or Sickness Producer Practice Questions
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Sample Practice Questions
Try these 10 sample questions from the SD Accident & Health or Sickness Producer practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.
1A self-employed consultant wants a policy to replace her personal earnings if illness prevents her from working for months. Which coverage best addresses that loss?
- A. Individual disability income insurance
- B. Business overhead expense insurance
- C. Key-person disability insurance
- D. Hospital confinement indemnity insurance
Answer: A
Explanation: "Disability insurance is designed to replace income or other expenses" The consultant needs replacement of her own earnings; overhead protects business expenses, key-person coverage pays a business, and hospital indemnity depends on confinement.
Reference: NAIC, Small Business Insurance — Disability Insurance section
2After issuing a South Dakota health policy, a producer tells the insured that the producer can waive a written exclusion without insurer approval. What is the effect of that statement?
- A. It amends the policy once the insured agrees
- B. It amends the policy when the next premium is paid
- C. It does not change the policy because the producer lacks that authority
- D. It changes only an endorsement but not the original policy
Answer: C
Explanation: "No insurance producer has authority to change this policy or to waive any of its provisions." The entire-contract provision denies the producer unilateral authority; policy changes require insurer executive approval and attachment or endorsement.
Reference: South Dakota Codified Laws, Chapter 58-17 — SDCL ch. 58-17, Entire contract; changes provision
3A Medicare beneficiary asks which part of Original Medicare primarily helps with doctor visits and outpatient care. Which part is it?
- A. Part A, hospital insurance
- B. Part B, medical insurance
- C. Part C, Medicare Advantage
- D. Part D, drug coverage
4After a covered partial disability, an insured works fewer hours and earns less than before. Which disability policy feature specifically fills the remaining income gap?
- A. Cost-of-living adjustment
- B. Residual disability benefit
- C. Future increase option
- D. Waiver-of-premium feature
5An insurer wants a consumer report about a current health-insurance applicant. For which use does the FCRA give the insurer a permissible purpose?
- A. To select consumers for the insurer's next marketing campaign
- B. To underwrite insurance involving that applicant
- C. To compare the applicant's neighbors' credit histories
- D. To measure the producer's regional sales performance
Answer: B
Explanation: "You must have a permissible purpose before obtaining a consumer report" Insurance underwriting involving the consumer is a permissible purpose; the other prerequisites do not replace that FCRA condition.
Reference: FTC, Consumer Reports: What Insurers Need to Know — Consumer Reports, permissible purpose
6A South Dakota producer asks who may open an additional investigation into a possible Title 58 violation. Who has that authority?
- A. The insurance director
- B. The state treasurer
- C. The county auditor
- D. The insurer's actuary
7When a disabled dependent reaches a policy's limiting age, how soon must proof of incapacity and dependency initially be furnished?
- A. Within 10 days
- B. Within 31 days
- C. Within 60 days
- D. Within 90 days
8The owner of a two-person firm is disabled but must keep paying rent, utilities, and staff wages. Which disability coverage is directed at those bills?
- A. Individual disability income coverage
- B. Business overhead expense coverage
- C. Key-person disability coverage
- D. Group disability income coverage
Answer: B
Explanation: "covers standard business expenses such as payroll, utilities," The bills are operating expenses during the owner's recovery, rather than the owner's salary or an employee benefit.
Reference: NAIC, Small Business Insurance — Disability Insurance section, business overhead paragraph
9An excepted-benefit health policy has been in force for three years. An ordinary, nonfraudulent application misstatement is discovered after a covered loss begins. How does the two-year defense rule apply?
- A. The insurer may void the policy for the ordinary misstatement
- B. The insurer may deny the later loss but keep the policy
- C. The insurer may void only if the loss began after year two
- D. The insurer may not void or deny that later loss on this basis
Answer: D
Explanation: "After two years from the date of issue of this policy no misstatements, except fraudulent misstatements" The two-year defense limit for excepted benefits bars use of an ordinary misstatement for a loss beginning afterward; fraud remains an exception.
Reference: South Dakota Codified Laws, Chapter 58-17 — SDCL ch. 58-17, Time limit on certain defenses provision
10A retiree chooses a Medicare-approved private plan that bundles Part A and Part B benefits and usually drug coverage. What program is this?
- A. Original Medicare Part A
- B. Original Medicare Part B
- C. Medicare Advantage Part C
- D. Medicare supplement coverage
Topics in this practice bank
These topics describe the available practice for SD Accident & Health or Sickness Producer. Review the examination outline and its sources for scope and allocation details.
General knowledge: I. TYPES OF POLICIES
- A. Disability income
- A. Disability income / 1. Individual disability income policy
- A. Disability income / 2. Business overhead expense policy
- A. Disability income / 3. Business disability buyout policy
- A. Disability income / 4. Group disability income policy
- A. Disability income / 5. Key employee policy
- B. Accidental death and dismemberment
- C. Medical expense insurance
- C. Medical expense insurance / 1. Basic hospital, medical, and surgical policies
- C. Medical expense insurance / 2. Major medical policies
- C. Medical expense insurance / 3. Health Maintenance Organizations (HMOs)
- C. Medical expense insurance / 4. Preferred Provider Organizations (PPOs)
- C. Medical expense insurance / 5. Point of Service (POS) plans
- C. Medical expense insurance / 6. Flexible Spending Accounts (FSAs)
- C. Medical expense insurance / 7. High Deductible Health Plans (HDHPs) and related Health Savings Accounts (HSAs)
- C. Medical expense insurance / 8. Health Reimbursement Accounts (HRAs)
- D. Medicare supplement policies
- E. Group insurance
- E. Group insurance / 1. Differences between individual and group contracts
- E. Group insurance / 2. General characteristics
- E. Group insurance / 3. COBRA
- F. Individual/Group Long Term Care (LTC)
- F. Individual/Group Long Term Care (LTC) / 1. Eligibility
- F. Individual/Group Long Term Care (LTC) / 2. Levels of care
- G. Other policies
- G. Other policies / 1. Dental
- G. Other policies / 2. Vision
- G. Other policies / 3. Cancer
- G. Other policies / 4. Critical illness or specified disease
- G. Other policies / 5. Worksite (employer-sponsored)
- G. Other policies / 6. Hospital indemnity
- G. Other policies / 7. Short-term medical
- G. Other policies / 8. Accident
General knowledge: II. POLICY PROVISIONS, CLAUSES, AND RIDERS
- A. Mandatory and optional provisions
- A. Mandatory and optional provisions / 1. Entire contract
- A. Mandatory and optional provisions / 2. Time limit on certain defenses (incontestable)
- A. Mandatory and optional provisions / 3. Grace period
- A. Mandatory and optional provisions / 4. Reinstatement
- A. Mandatory and optional provisions / 5. Notice of claim
- A. Mandatory and optional provisions / 6. Claim forms
- A. Mandatory and optional provisions / 7. Proof of loss
- A. Mandatory and optional provisions / 8. Time of payment of claims
- A. Mandatory and optional provisions / 9. Payment of claims
- A. Mandatory and optional provisions / 10. Physical examination and autopsy
- A. Mandatory and optional provisions / 11. Legal actions
- A. Mandatory and optional provisions / 12. Change of beneficiary
- A. Mandatory and optional provisions / 13. Misstatement of age or sex
- A. Mandatory and optional provisions / 14. Change of occupation
- A. Mandatory and optional provisions / 15. Illegal occupation
- A. Mandatory and optional provisions / 16. Relation of earnings to insurance
- B. Other provisions and clauses
- B. Other provisions and clauses / 1. Insuring clause
- B. Other provisions and clauses / 2. Free look
- B. Other provisions and clauses / 3. Consideration clause
- B. Other provisions and clauses / 4. Probationary period
- B. Other provisions and clauses / 5. Elimination period
- B. Other provisions and clauses / 6. Waiver of premium
- B. Other provisions and clauses / 7. Exclusions and limitations
- B. Other provisions and clauses / 8. Preexisting conditions
- B. Other provisions and clauses / 9. Coinsurance
- B. Other provisions and clauses / 10. Deductibles
- B. Other provisions and clauses / 11. Eligible expenses
- B. Other provisions and clauses / 12. Copayments
- B. Other provisions and clauses / 13. Pre-authorizations and prior approval requirements
- B. Other provisions and clauses / 14. Usual, reasonable, and customary (URC) charges
- B. Other provisions and clauses / 15. Lifetime, annual, or per cause maximum benefit limits
- C. Riders
- C. Riders / 1. Impairment/exclusions
- C. Riders / 2. Guaranteed insurability
- C. Riders / 3. Future increase option
- D. Rights of renewability
- D. Rights of renewability / 1. Noncancelable
- D. Rights of renewability / 2. Cancelable
- D. Rights of renewability / 3. Guaranteed renewable
General knowledge: III. SOCIAL INSURANCE
- A. Medicare (Parts A, B, C, D)
- B. Medicaid
- C. Social Security benefits
General knowledge: IV. OTHER INSURANCE CONCEPTS
- A. Total, partial, recurrent and residual disability
- B. Owner’s rights
- C. Dependent children benefits
- D. Primary and contingent beneficiaries
- E. Modes of premium payments
- F. Nonduplication and coordination of benefits (e.g., primary vs. excess)
- G. Occupational vs. non-occupational
- H. Tax treatment of premiums and proceeds of insurance contracts (e.g., disability income and medical expenses, etc.)
- I. Managed care
- J. Workers Compensation
- J. Workers Compensation / 1. Impact on health insurance benefits
- K. Subrogation
- L. Cost containment
General knowledge: V. FIELD UNDERWRITING PROCEDURES
- A. Completing the application
- B. Explaining sources of insurability and HIPAA privacy information (e.g., MIB Report, Fair Credit Reporting Act, etc.)
- C. Initial premium payment and receipt and consequences of the receipt (e.g., medical examination, etc.)
- D. Submitting application (and initial premium if collected) to company for underwriting
- E. Policy delivery
- F. Explainingpolicyand its provisions, riders, exclusions, and ratings to clients
- G. Replacement
- H. Contract law
- H. Contract law / 1. Elements of a contract
- H. Contract law / 2. Insurable interest
- H. Contract law / 3. Warranties and representations
- H. Contract law / 4. Unique aspects of the insurance contract
- H. Contract law / 4. Unique aspects of the insurance contract / a. Conditional
- H. Contract law / 4. Unique aspects of the insurance contract / b. Unilateral
- H. Contract law / 4. Unique aspects of the insurance contract / c. Adhesion
- H. Contract law / 4. Unique aspects of the insurance contract / d. Aleatory
South Dakota specific: I. SD STATUTES, RULES, AND REGULATIONS COMMON TO LIFE, ACCIDENT AND HEALTH, PROPERTY, AND CASUALTY INSURANCE
- A. Director of Insurance
- A. Director of Insurance / 1. Duties and powers
- A. Director of Insurance / 2. Examination of records
- A. Director of Insurance / 3. Hearings/notice of hearings
- A. Director of Insurance / 4. Penalties (and fines)
- A. Director of Insurance / 5. Cease and desist orders
- B. Insurance Definitions
- B. Insurance Definitions / 1. Acts constituting an insurance transaction
- B. Insurance Definitions / 2. Domestic, foreign and alien company
- B. Insurance Definitions / 3. Fraternals
- B. Insurance Definitions / 4. Authorized and unauthorized companies
- B. Insurance Definitions / 5. Stock and mutual companies
- B. Insurance Definitions / 6. Certificate of authority
- C. Licensing
- C. Licensing / 1. Types of licenses
- C. Licensing / 1. Types of licenses / a. Producer
- C. Licensing / 1. Types of licenses / b. Resident/Nonresident
- C. Licensing / 1. Types of licenses / c. Temporary license
- C. Licensing / 1. Types of licenses / d. Business entity
- C. Licensing / 2. Qualifications for obtaining a license
- C. Licensing / 2. Qualifications for obtaining a license / a. Exemptions/Exceptions
- C. Licensing / 2. Qualifications for obtaining a license / b. License denial
- C. Licensing / 3. Maintaining a license
- C. Licensing / 3. Maintaining a license / a. Continuing education
- C. Licensing / 3. Maintaining a license / b. Change of address
- C. Licensing / 3. Maintaining a license / c. Renewal/Nonrenewal
- C. Licensing / 3. Maintaining a license / d. Record maintenance
- C. Licensing / 3. Maintaining a license / e. License suspension/ revocation/refusalto issue or renew
- C. Licensing / 3. Maintaining a license / f. Reporting of actions
- C. Licensing / 3. Maintaining a license / g. Assumed business name
- C. Licensing / 3. Maintaining a license / h. Inactivity due to military service
- C. Licensing / 3. Maintaining a license / i. Inactivity due to extenuating circumstances
- C. Licensing / 3. Maintaining a license / j. Reinstatement, continuation, termination
- C. Licensing / 4. Appointments
- C. Licensing / 4. Appointments / a. Termination of appointment
- D. Producer responsibilities
- D. Producer responsibilities / 1. Fiduciary responsibilities
- D. Producer responsibilities / 2. Commissions, compensation, fees
- D. Producer responsibilities / 3. Reporting of felonies and crimes of moral turpitude
- D. Producer responsibilities / 4. Influence of witnesses
- D. Producer responsibilities / 5. Response to Division inquiries
- E. Life and Health Insurance Guaranty Association
- E. Life and Health Insurance Guaranty Association / 1. Purpose and disclaimer
- E. Life and Health Insurance Guaranty Association / 2. Advertising
- F. Marketing practices
- F. Marketing practices / 13. 1, 14, 15, 24, 25, 26, 32, 35, 36, 37, 56, 76, 77, 78, 125;
- F. Marketing practices / 1. Unfair practices
- F. Marketing practices / 1. Unfair practices / a. Boycott, coercion, intimidation
- F. Marketing practices / 1. Unfair practices / b. Commingling
- F. Marketing practices / 1. Unfair practices / c. Controlled business
- F. Marketing practices / 1. Unfair practices / d. Defamation
- F. Marketing practices / 1. Unfair practices / e. False advertising
- F. Marketing practices / 1. Unfair practices / f. Illegal inducement
- F. Marketing practices / 1. Unfair practices / g. Misrepresentation
- F. Marketing practices / 1. Unfair practices / h. Rebating
- F. Marketing practices / 1. Unfair practices / i. Twisting
- F. Marketing practices / 1. Unfair practices / j. Unfair discrimination
- F. Marketing practices / 1. Unfair practices / k. Acting without a license
- F. Marketing practices / 1. Unfair practices / l. Larceny
- F. Marketing practices / 1. Unfair practices / m. Prohibited fees/ premiums/ extra charges
- F. Marketing practices / 1. Unfair practices / n. Loans
- F. Marketing practices / 1. Unfair practices / o. Notification of suspected fraud
- F. Marketing practices / 2. Unfair claims settlement practices
- G. Policy delivery and receipt
- H. Insurance Fraud Regulation
South Dakota specific: II. SD STATUTES, RULES, AND REGULATIONS PERTINENT TO ACCIDENT AND HEALTH INSURANCE ONLY
- A. South Dakota requirements (individual and group)
- A. South Dakota requirements (individual and group) / 1. Eligibility requirements
- A. South Dakota requirements (individual and group) / 1. Eligibility requirements / a. Family coverage
- A. South Dakota requirements (individual and group) / 1. Eligibility requirements / b. Intellectual or physical disability coverage
- A. South Dakota requirements (individual and group) / 1. Eligibility requirements / c. Newborn child coverage
- A. South Dakota requirements (individual and group) / 1. Eligibility requirements / d. Dependent coverage
- A. South Dakota requirements (individual and group) / 2. Benefit offers
- A. South Dakota requirements (individual and group) / 2. Benefit offers / a. Alcoholism treatment coverage and benefit limitations
- A. South Dakota requirements (individual and group) / 2. Benefit offers / b. Chiropractor
- A. South Dakota requirements (individual and group) / 2. Benefit offers / c. Diabetes
- A. South Dakota requirements (individual and group) / 3. Advertising
- B. Employer group Health insurance
- B. Employer group Health insurance / 1. Continuation of coverage under COBRA and South Dakota Specific Rules
- B. Employer group Health insurance / 2. Conversion including, divorce, cancellation, or nonrenewal
- C. Medicare Supplement Insurance
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / a. Delivery of buyer’s guide
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / b. Delivery of Outline of Coverage
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / c. Replacement requirements
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / d. Refund
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / e. Pre-existing conditions
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / f. Right to examine (Free Look)
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / g. Overinsurance prohibited
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / h. Suitability
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / i. Misrepresentation
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / j. Failure to provide forms
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / k. Prohibited marketing practices
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / l. Duplication of coverage prohibited
- C. Medicare Supplement Insurance / 1. South Dakota regulations and required provisions / m. Cancellation or nonrenewal
- C. Medicare Supplement Insurance / 2. Medicare SELECT
- D. Long-term Care Policies
- D. Long-term Care Policies / 1. LTC Partnerships, definitions & Deficit Reduction Act of 2005
- D. Long-term Care Policies / 2. Exclusions
- D. Long-term Care Policies / 3. Advertising
- D. Long-term Care Policies / 4. Marketing Standards
- D. Long-term Care Policies / 5. Right to Return (free look)
- D. Long-term Care Policies / 6. Cost-of-Living Adjustments
- D. Long-term Care Policies / 7. Pre-existing conditions
- D. Long-term Care Policies / 8. Outline of Coverage
- D. Long-term Care Policies / 9. Activities of daily living (ADLs)
- D. Long-term Care Policies / 10. Appropriate of recommended purchase or replacement
- D. Long-term Care Policies / 11. Shopper’s guide
- D. Long-term Care Policies / 12. Suitability
- D. Long-term Care Policies / 13. Rate stabilization
- E. Small employer medical plans
- E. Small employer medical plans / 1. Definition of small employer
- E. Small employer medical plans / 2. Benefit plans offered
- E. Small employer medical plans / 3. Availability of coverage
- E. Small employer medical plans / 4. Prohibited Activities
- F. ACA (Affordable Care Act)
- F. ACA (Affordable Care Act) / 1. On-exchange versus off exchange
- F. ACA (Affordable Care Act) / 2. Subsidized versus non subsidized
- F. ACA (Affordable Care Act) / 3. Eligibility
- F. ACA (Affordable Care Act) / 3. Eligibility / a. Medicare/Medicaid
- F. ACA (Affordable Care Act) / 3. Eligibility / b. Advance premium tax credits
- F. ACA (Affordable Care Act) / 3. Eligibility / c. Cost sharing reductions
- F. ACA (Affordable Care Act) / 4. Essential Health Benefits (EHBs)
- F. ACA (Affordable Care Act) / 4. Essential Health Benefits (EHBs) / a. No lifetime/annual limits
- F. ACA (Affordable Care Act) / 4. Essential Health Benefits (EHBs) / b. Benchmark plan
- F. ACA (Affordable Care Act) / 4. Essential Health Benefits (EHBs) / c. Mental health and substance abuse
- F. ACA (Affordable Care Act) / 5. Qualified Health Plan
- F. ACA (Affordable Care Act) / 6. Actuarial value
- F. ACA (Affordable Care Act) / 7. Levels of coverage (metal tiers)
- F. ACA (Affordable Care Act) / 8. Special enrollment periods
- F. ACA (Affordable Care Act) / 9. Minimum essential coverage
- F. ACA (Affordable Care Act) / 9. Minimum essential coverage / a. Tax penalties
- F. ACA (Affordable Care Act) / 9. Minimum essential coverage / b. Hardship exemption
- F. ACA (Affordable Care Act) / 9. Minimum essential coverage / c. Catastrophic plan
- F. ACA (Affordable Care Act) / 10. Rating structures
- F. ACA (Affordable Care Act) / 11. External review
- F. ACA (Affordable Care Act) / 12. Qualifying events
- F. ACA (Affordable Care Act) / 13. Guaranteed Issue
- F. ACA (Affordable Care Act) / 13. Guaranteed Issue / a. No health underwriting
- F. ACA (Affordable Care Act) / 13. Guaranteed Issue / b. No pre-existing conditions
- F. ACA (Affordable Care Act) / 13. Guaranteed Issue / c. No waiting periods
- F. ACA (Affordable Care Act) / 13. Guaranteed Issue / d. Guaranteed renewability/re-enrollment
- F. ACA (Affordable Care Act) / 14. Dependents
- F. ACA (Affordable Care Act) / 14. Dependents / a. Age limits
- F. ACA (Affordable Care Act) / 14. Dependents / b. Dependent continuation
- F. ACA (Affordable Care Act) / 15. Emergency care
- F. ACA (Affordable Care Act) / 16. Preventative benefits
- F. ACA (Affordable Care Act) / 17. Pediatric dental and vision
- F. ACA (Affordable Care Act) / 18. Requirements for termination
- F. ACA (Affordable Care Act) / 18. Requirements for termination / a. Rescission
- F. ACA (Affordable Care Act) / 19. Network
- F. ACA (Affordable Care Act) / 19. Network / a. Adequacy
- F. ACA (Affordable Care Act) / 19. Network / b. Design
- F. ACA (Affordable Care Act) / 19. Network / c. Narrow
- F. ACA (Affordable Care Act) / 19. Network / d. Provider directory
- F. ACA (Affordable Care Act) / 20. Formulary
- F. ACA (Affordable Care Act) / 21. Marketing
- F. ACA (Affordable Care Act) / 21. Marketing / a. Summary of benefits and coverage
- F. ACA (Affordable Care Act) / 21. Marketing / b. Plan brochures
- F. ACA (Affordable Care Act) / 21. Marketing / c. Federal marketplace
- F. ACA (Affordable Care Act) / 22. Navigators
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