MI LIFE PRODUCER PRACTICE EXAM 2025/2026
QUESTIONS AND SOLUTIONS MARKED A+
✔✔Dorian exercised a nonforfeiture option by using his life policy's cash value to
purchase an extended term insurance option. When the term insurance expires - ✔✔the
protection ends
✔✔A insurance producer MUST notify the Commissioner of a change in legal name,
email, or address: - ✔✔Within 30 days of the change
✔✔All of these are valid options for an Adjustable Life Policy EXCEPT - ✔✔A
nonforfeiture option can be used to increase the death benefit
✔✔An applicant's character and personal habits can be obtained for underwriting
purposes from which source? - ✔✔Investigative consumer report
✔✔What is the purpose of the Arkansas Life and Health Insurance Guaranty
Association? - ✔✔Protects policy owners against insolvent insurance companies
✔✔Which of these is considered to be a Living Benefit option in a life insurance policy?
- ✔✔Accelerated death benefit
✔✔Which situation accurately describes a reduced paid-up nonforfeiture option? -
✔✔Policy has a decreased face amount
✔✔Which of these is considered a major tax advantage of life insurance? - ✔✔Income
tax is typically not owed on proceeds paid directly to a beneficiary
✔✔Which policy feature makes a universal life policy different from a whole life policy? -
✔✔A flexible premium schedule
✔✔Which of the following are the premium payments for a universal life policy NOT
used for? - ✔✔Separate account investments
✔✔Which approach predicts a person's earning potential & determines how much of
that amount would be devoted to dependents? - ✔✔Human life value approach
✔✔Over the course of a year, which premium payment mode is most expensive? -
✔✔monthly
✔✔Who is responsible for assembling the policy forms for insureds? - ✔✔Insurance
carriers
, ✔✔A non-contributory health insurance plan helps the insurer avoid - ✔✔adverse
selection
✔✔Which of these is NOT a characteristic of the Accelerated Death Benefit option? -
✔✔The benefit can be offered as a rider at a specific extra cost or may be at no cost
✔✔The taxable portion of each annuity payment is calculated using which method? -
✔✔Exclusion ratio
✔✔The standard grace period for a life insurance policy sold in Arkansas is: - ✔✔31
days
✔✔Who receive the benefits from a Credit Life or Disability policy? - ✔✔Creditor
✔✔A Modified Endowment Contract (MEC) is best described as - ✔✔A life insurance
contract which accumulates cash values higher than the IRS will allow
✔✔Which of the following provisions is NOT required to be included in life insurance
polices sold in Arkansas? - ✔✔Extended term
✔✔What is an insurer required to do when faced with an error made under the
Misstatement of age provision? - ✔✔Pay age-corrected benefits
✔✔What is a corridor in relation to a Universal Life insurance policy? - ✔✔The gap
between the total death benefit and the policy's cash value
✔✔All of these are common exclusions to a life insurance policy EXCEPT -
✔✔accidental death
✔✔The type of policy which pays on the death of the last person is called -
✔✔survivorship life
✔✔A change in an insurance application requires - ✔✔an initial made by the applicant
✔✔Which of these factors would an insurer consider when determining whether to
accept a group life plan? - ✔✔average age
✔✔A life insurance claim which involves a per capita distribution of policy proceeds
would be payable to the - ✔✔named living primary beneficiaries
✔✔Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life
policy covering all three of their lives. If Mike dies first, the policy proceeds - ✔✔will no
longer provide insurance protection
QUESTIONS AND SOLUTIONS MARKED A+
✔✔Dorian exercised a nonforfeiture option by using his life policy's cash value to
purchase an extended term insurance option. When the term insurance expires - ✔✔the
protection ends
✔✔A insurance producer MUST notify the Commissioner of a change in legal name,
email, or address: - ✔✔Within 30 days of the change
✔✔All of these are valid options for an Adjustable Life Policy EXCEPT - ✔✔A
nonforfeiture option can be used to increase the death benefit
✔✔An applicant's character and personal habits can be obtained for underwriting
purposes from which source? - ✔✔Investigative consumer report
✔✔What is the purpose of the Arkansas Life and Health Insurance Guaranty
Association? - ✔✔Protects policy owners against insolvent insurance companies
✔✔Which of these is considered to be a Living Benefit option in a life insurance policy?
- ✔✔Accelerated death benefit
✔✔Which situation accurately describes a reduced paid-up nonforfeiture option? -
✔✔Policy has a decreased face amount
✔✔Which of these is considered a major tax advantage of life insurance? - ✔✔Income
tax is typically not owed on proceeds paid directly to a beneficiary
✔✔Which policy feature makes a universal life policy different from a whole life policy? -
✔✔A flexible premium schedule
✔✔Which of the following are the premium payments for a universal life policy NOT
used for? - ✔✔Separate account investments
✔✔Which approach predicts a person's earning potential & determines how much of
that amount would be devoted to dependents? - ✔✔Human life value approach
✔✔Over the course of a year, which premium payment mode is most expensive? -
✔✔monthly
✔✔Who is responsible for assembling the policy forms for insureds? - ✔✔Insurance
carriers
, ✔✔A non-contributory health insurance plan helps the insurer avoid - ✔✔adverse
selection
✔✔Which of these is NOT a characteristic of the Accelerated Death Benefit option? -
✔✔The benefit can be offered as a rider at a specific extra cost or may be at no cost
✔✔The taxable portion of each annuity payment is calculated using which method? -
✔✔Exclusion ratio
✔✔The standard grace period for a life insurance policy sold in Arkansas is: - ✔✔31
days
✔✔Who receive the benefits from a Credit Life or Disability policy? - ✔✔Creditor
✔✔A Modified Endowment Contract (MEC) is best described as - ✔✔A life insurance
contract which accumulates cash values higher than the IRS will allow
✔✔Which of the following provisions is NOT required to be included in life insurance
polices sold in Arkansas? - ✔✔Extended term
✔✔What is an insurer required to do when faced with an error made under the
Misstatement of age provision? - ✔✔Pay age-corrected benefits
✔✔What is a corridor in relation to a Universal Life insurance policy? - ✔✔The gap
between the total death benefit and the policy's cash value
✔✔All of these are common exclusions to a life insurance policy EXCEPT -
✔✔accidental death
✔✔The type of policy which pays on the death of the last person is called -
✔✔survivorship life
✔✔A change in an insurance application requires - ✔✔an initial made by the applicant
✔✔Which of these factors would an insurer consider when determining whether to
accept a group life plan? - ✔✔average age
✔✔A life insurance claim which involves a per capita distribution of policy proceeds
would be payable to the - ✔✔named living primary beneficiaries
✔✔Shawn, Mike, and Dave are brothers who have a $100,000 "first to die" joint life
policy covering all three of their lives. If Mike dies first, the policy proceeds - ✔✔will no
longer provide insurance protection
