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Unit 24 Michigan Laws and Regulations Pertinent to Life Insurance Exam
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Unit 24 Michigan Laws and Regulations Pertinent to Life Insurance Exam
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Unit 24: Michigan Laws and RegulationsPertinent to Life Insurance Exam
Under which of the following types of policies does an insured have to be notified if
current policy values are insufficient to maintain the policy, given guaranteed interest
and expense rates? - Answer -universal life insurance
Implying that policy dividends are guaranteed as in inducement for an insured to drop
existing insurance and purchase new insurance is - Answer -twisting
The minimum number of lives that must be covered under a group life insurance policy
in Michigan is - Answer -2
The replacement requirement under life insurance includes - Answer -whole life policy
under a 1035 exchange
A producer persuades an insured to borrow 75% of the cash value in an existing life
insurance policy to pay the premium for a new purchase of life insurance. Which of the
following statements is CORRECT? - Answer -replacement is involved in compliance
with replacement regulations is necessary
A producer must do all of the following when replacing a life insurance policy EXCEPT -
Answer -notify the existing insurer of the replacement transaction
Which of the following is an example of a prohibited life insurance policy provision? -
Answer -backdating a policy 8 months to reduce the premium
The maximum life insurance policy loan interest that may be charged on a fixed interest
loan basis is - Answer -8%
All of the following are considered to be defined as a replacement of a policy - Answer -
borrowing 10% of the cash value of an existing policy to buy a new life insurance policy
Which of the following statements regarding policy provisions in a life insurance contract
is CORRECT? - Answer -an insurer may charge up to 18% interest on a loan if it uses
an adjustable rate
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