The North Carolina Life Insurance Examination is the mandatory assessment required to become a licensed life insurance agent in the state. This examination verifies that a candidate possesses the foundational knowledge necessary to responsibly advise the public and transact business. Navigating the exam process requires understanding the structure, content, and administrative steps involved.
Key Facts About the NC Life Insurance Exam
The North Carolina Life Insurance Agent Examination consists of 60 multiple-choice questions, which must be completed within 75 minutes. Only 55 questions are scored and count toward the final result; the remaining five are pre-test questions used for future exam versions. Candidates cannot identify the pre-test items, so all questions must be answered. A minimum score of 70% on the 55 scored questions is required to pass. The test is administered via computer at third-party testing centers, with Pearson VUE handling scheduling and logistics.
Detailed Breakdown of Exam Content
The examination content is divided into specific categories with assigned weightings. The 55 scored questions are grouped into four main sections, with a significant emphasis on general life insurance principles and a dedicated portion for state-specific regulations.
General Life Insurance Knowledge
This section covers the foundational concepts of life insurance and accounts for a substantial number of the examination questions. Topics include the basic mechanics of risk pooling, mortality tables, and interest rates, which are used to determine premium calculations. Candidates are tested on various types of policies, such as term and whole life insurance, as well as non-traditional policies like Universal Life.
Policy Provisions and Contract Law
This area focuses on the detailed elements within an insurance contract and the legal framework governing them, making up approximately 20% of the scored material. Questions cover specific clauses, such as the incontestability and grace period provisions, and the various riders that can be added to a policy. This part also tests knowledge of settlement options, beneficiary designations, and the legal aspects of contract formation, including the concepts of offer, acceptance, and consideration.
Producer Responsibilities and Ethical Practices
Questions related to a producer’s duties are integrated across various topics, particularly within the state law section. This content focuses on fiduciary responsibilities, the rules governing the replacement of existing policies, and proper marketing standards. Candidates must understand prohibited activities, such as defamation, false advertising, and unfair trade practices.
North Carolina State Laws, Rules, and Regulations
This category comprises approximately 25% of the total scored questions and draws heavily from the state’s insurance statutes found in N.C. Gen. Stat. Chapter 58. Questions assess knowledge of licensing requirements, continuing education obligations, and the powers and duties of the Commissioner of Insurance. Detailed compliance issues include the specific rules for handling premiums and the regulatory definitions unique to the state.
Pre-Licensing Education Requirements
Prior to scheduling the state examination, candidates must complete a pre-licensing education (PLE) course approved by the North Carolina Department of Insurance (NCDOI). The requirement for the Life line of authority is a mandatory 20-hour course, offered by various state-approved providers. Upon successful completion of the course and its final exam, the provider issues a course completion certificate. This certificate, often called an Exam Admission Ticket, is a prerequisite for registering for the state licensing exam. The certificate is valid for 90 days or five examination attempts, meaning the state exam must be passed within that window before the PLE course must be retaken.
How to Register and Schedule Your Exam
The registration process begins with submitting an electronic application to the National Insurance Producer Registry (NIPR) and paying the associated fees, including the initial application and fingerprint fees. This step generates the National Producer Number (NPN) and provides an email authorization from Pearson VUE, the state’s testing vendor. Candidates use this authorization and their NPN to schedule their examination appointment online or by phone with Pearson VUE. The examination fee, currently $45 per attempt, is due at the time of scheduling. On the day of the test, candidates must present two valid forms of identification, one of which must be a government-issued photo ID with a signature, and should arrive at the testing center at least 30 minutes before the scheduled time.
Next Steps After Passing the Examination
Once the examination is successfully completed, the final step involves formally applying for the license through the NCDOI. The exam score remains valid for 12 months, though the NIPR application is generally valid for six months from submission. As part of the application process, all resident license applicants must submit electronic fingerprints for a criminal background check, as mandated by North Carolina General Statute 58-33-48. After the NCDOI receives the passing score, the license application, and the completed background check, the license is typically issued. A newly licensed agent must then be formally appointed by an insurance company before they can legally solicit, negotiate, or transact insurance business in the state.