Health Insurance Cheat Sheet.
The night-before summary, built like the exam.

Health Insurance License Exam — Cheat Sheet

Note: State-specific numbers (passing scores, license fees, CE hours, continuing-education deadlines, and statutory citations) vary by jurisdiction and are not asserted here. Confirm every number against your state's official exam outline before test day.

Core Policy Provisions (Know Cold)

• Insuring clause — states the insurer's basic promise to pay.
• Consideration clause — the exchange of premium (applicant) for the promise to pay (insurer).
• Free-look period — right to return the policy for a full refund shortly after delivery.
• Grace period — time after a due date in which a late premium keeps coverage in force.
• Reinstatement — restoring a lapsed policy, typically requiring back premium and evidence of insurability.
• Incontestability — after a set period, the insurer generally cannot void the policy for misstatements.
• Elimination (waiting) period — days of disability before benefits begin; longer period = lower premium.

Types of Health Coverage

• Medical expense — HMO, PPO, POS, EPO, high-deductible plans.
• Disability income — replaces lost earnings (short-term vs. long-term; own-occupation vs. any-occupation).
• Long-term care (LTC) — custodial and skilled care not covered by standard medical plans.
• Supplemental — Medicare Supplement (Medigap), dental, vision, critical illness, accident.

Cost-Sharing Terms

• Premium — what you pay to keep coverage.
• Deductible — paid before the plan starts paying.
• Copay — flat fee per service.
• Coinsurance — percentage split after the deductible (e.g., plan pays the larger share, insured the rest).
• Out-of-pocket maximum — annual ceiling on the insured's cost sharing; the plan pays 100% of covered services afterward.

Managed Care — Quick Contrast

• HMO — lowest cost, requires PCP/gatekeeper, in-network only, referrals for specialists.
• PPO — more flexibility, no referral needed, out-of-network allowed at higher cost.
• POS — hybrid: PCP gatekeeper like an HMO but permits out-of-network like a PPO.
• EPO — in-network only (like HMO) but usually no referral requirement.

Underwriting & Application Concepts

• Representations vs. warranties — statements believed true vs. statements guaranteed true.
• Material misrepresentation — a false statement that affects the risk decision; can void coverage.
• Concealment — deliberately withholding a material fact.
• Adverse selection — the tendency of higher-risk individuals to seek coverage.
• Field underwriting — the producer's role in collecting accurate application information.

Key Federal Frameworks (Conceptual)

• Guaranteed issue / no pre-existing-condition exclusions — core consumer-protection concept in modern individual major medical.
• Continuation of coverage — the right of eligible individuals to continue group coverage after qualifying events.
• Portability & privacy — protection of health information and continuity when changing plans.
• Coordination of benefits (COB) — rules preventing duplicate payment when covered by more than one plan.

Producer Ethics & Law (High-Yield)

• Fiduciary duty — act in the client's best interest; handle premiums as trust funds.
• Fair dealing prohibitions — no rebating, twisting (misleading replacement), churning, defamation, or coercion.
• Suitability — recommend coverage appropriate to the client's needs and ability to pay.
• Errors & omissions (E&O) — professional liability protection for the producer.

Test-Day Strategy

• Read every question for qualifiers — "except," "not," "always," "never" flip the correct answer.
• Eliminate two obviously wrong choices first, then decide between the remaining two.
• Distinguish who pays (insured vs. insurer) and when (before vs. after the deductible).
• Answer every question — there is typically no penalty for guessing; flag and return to hard ones.