MI LIFE INSURANCE ACTUAL EXAM PAPER
2026 QUESTIONS AND SOLUTIONS
GRADED A+
◉ Policyowner.
Answer: The person who owns the life insurance policy and has
control over it.
◉ Insured.
Answer: The person whose life is covered by the policy.
◉ Beneficiary.
Answer: The person or entity that receives the death benefit when
the insured dies.
◉ Premium.
Answer: The amount paid by the policyowner to keep the policy
active.
◉ Underwriting.
, Answer: The process insurers use to evaluate risk and determine
rates for coverage.
◉ Adverse Selection.
Answer: The tendency of higher-risk individuals to seek insurance
more often than lower-risk individuals.
◉ Term Life Insurance.
Answer: Temporary insurance that provides coverage for a set
number of years (e.g., 10, 20, or 30 years) with no cash value.
◉ Whole Life Insurance.
Answer: Permanent insurance that provides lifetime coverage with
fixed premiums and builds cash value.
◉ Universal Life Insurance.
Answer: Flexible permanent life insurance that allows policyholders
to adjust premiums and death benefits.
◉ Variable Life Insurance.
Answer: Life insurance that allows investment of cash value in
stocks and other securities; the death benefit and cash value
fluctuate based on market performance.
2026 QUESTIONS AND SOLUTIONS
GRADED A+
◉ Policyowner.
Answer: The person who owns the life insurance policy and has
control over it.
◉ Insured.
Answer: The person whose life is covered by the policy.
◉ Beneficiary.
Answer: The person or entity that receives the death benefit when
the insured dies.
◉ Premium.
Answer: The amount paid by the policyowner to keep the policy
active.
◉ Underwriting.
, Answer: The process insurers use to evaluate risk and determine
rates for coverage.
◉ Adverse Selection.
Answer: The tendency of higher-risk individuals to seek insurance
more often than lower-risk individuals.
◉ Term Life Insurance.
Answer: Temporary insurance that provides coverage for a set
number of years (e.g., 10, 20, or 30 years) with no cash value.
◉ Whole Life Insurance.
Answer: Permanent insurance that provides lifetime coverage with
fixed premiums and builds cash value.
◉ Universal Life Insurance.
Answer: Flexible permanent life insurance that allows policyholders
to adjust premiums and death benefits.
◉ Variable Life Insurance.
Answer: Life insurance that allows investment of cash value in
stocks and other securities; the death benefit and cash value
fluctuate based on market performance.
