10 exam-style questions with answers and explanations, straight from our 1,030-question bank. Tap an answer to check yourself. When you're ready, take the scored version in the free practice test.
The NMLH exam has 150 questions and runs 2 hours 30 minutes.
These 10 free NMLH questions are organized by exam domain, so you can see how each part of the New Mexico Life & Health Insurance Producer Exam blueprint is tested. Reveal the answer and explanation under each question.
A New Mexico producer accurately compares an existing whole life policy with a proposed replacement, including surrender charges, new contestability and suicide periods, premiums, and guarantees. The client elects the replacement. How should the transaction be characterized?
Correct answer: B - A lawful replacement, absent a material misstatement or omission
An agency hires an applicant with a felony conviction for breach of trust. The applicant holds an active New Mexico producer license but has never obtained written consent under 18 U.S.C. §1033. Before permitting participation in insurance business affecting interstate commerce, the agency must:
Correct answer: A - Secure prior written consent from an authorized insurance regulator
An applicant submits a signed life application with the first premium for $500,000 of coverage at the standard rate. The insurer approves the amount but issues the policy at a higher substandard premium. In contract formation, the insurer's action is:
Correct answer: A - A counteroffer requiring the applicant's acceptance
No premium accompanied a life application. After the policy is approved but before delivery, the proposed insured is hospitalized for a newly diagnosed cardiac condition. What should the producer do first?
Correct answer: C - Disclose the change to the insurer and follow its re-underwriting instructions
For one crediting period, an indexed universal life policy uses 80% participation, an 8% cap, and a 0% floor. The index gains 12%, and monthly policy charges still apply. What crediting outcome should the owner expect?
Correct answer: D - 8%, and policy charges may still reduce the cash value
A whole life policyowner can no longer pay premiums but wants coverage to continue for life with no further scheduled premiums, even if the face amount is smaller. Which nonforfeiture option meets that objective?
Correct answer: A - Reduced paid-up insurance
The ledger for a variable annuity shows a $200,000 GMWB benefit base, a 5% permitted annual withdrawal rate, and a $160,000 account value. Assuming rider conditions are met, how should the guarantee be explained?
Correct answer: C - The annual guarantee is $10,000 and can continue after account value reaches zero
A residual disability policy pays the same percentage of the full monthly benefit as the percentage loss of earned income. Before disability, the insured earned $10,000 per month and also received $2,000 in monthly investment income. After returning part time, earned income is $6,000 and the investment income is unchanged. If the full monthly benefit is $5,000, what residual benefit is payable?
Correct answer: C - $2,000
While traveling, an HMO member develops sudden crushing chest pain and is taken to the nearest emergency department, which is outside the plan's network. Which coverage principle applies?
Correct answer: D - Emergency care is an exception to ordinary HMO network and referral restrictions
A licensed practitioner certifies that an insured will need substantial assistance with bathing and dressing for an expected 120 days. No continuous skilled nursing is required. How should this situation be evaluated?
Correct answer: B - The LTC trigger may be met, while Medicare generally does not cover ongoing custodial care
The NMLH exam also covers these domains. Drill them in the full free practice test:
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