MI LIFE PRODUCER REVISION EXAM 2025/2026
QUESTIONS AND SOLUTIONS MARKED A+
✔✔A life insurance arrangement which circumvents insurable interest statutes is called:
a contract of adhesion
an indemnity contract
key person insurance
Investor-Originated Life Insurance - ✔✔IOLI
✔✔Q purchases a $500,000 life insurance policy and pays $900 in premiums over the
first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of
unequal values reflects which of the following insurance contract features?
Aleatory
Adhesion
Unilateral
Consideration - ✔✔aleatory
✔✔In regards to representations or warranties, which of these statements is TRUE?
Warranties are statements considered to be true to the best of the applicant's belief
If material to the risk, false representations will void a policy
Representations are statements guaranteed to be true in every respect
If material to the risk, false representations will NOT void a policy - ✔✔if material to the
risk, false representations will void a policy
✔✔A life insurance policy would be considered a wagering contract WITHOUT:
insurable interest
premium payment
agent solicitation
constructive delivery - ✔✔insurable interest
✔✔Which of these is NOT a type of agent authority?
Express
Implied
Principal
Apparent - ✔✔principal
✔✔Which of the following actions is NOT possible with a Universal Life policy?
Policy's cash value may be used to pay premiums
Premium payments may be made at unscheduled times
Premiums may be applied as a credit against income tax
Face amount may be adjusted - ✔✔premiums may be applied as a credit against
income tax
,✔✔What kind of insurance policy supplies an income stream over a set period of time
that starts when the insured dies?
Family Maintenance Policy
Family Income Policy
Survivor Policy
Family Survivor Policy - ✔✔family maintenance policy
✔✔A Family Income Policy is a combination of Whole Life and
Decreasing Term insurance
Level Term insurance
Deposit Term insurance
Increasing Term insurance - ✔✔decreasing term insurance
✔✔The Universal Life Policy is called an unbundled Life Policy because the
policyholder can see the expense charges, the interest earned, and the:
Premium tax
Dividend rate
Values based on mutual funds or stocks
Cost of insurance - ✔✔cost of insurance
✔✔What kind of life insurance product covers children under their parent's policy?
Family Maintenance rider
Term rider
Family Income rider
Payor benefit - ✔✔term rider
✔✔A(n) ______ Life policy offers the owner investment in products such as money-
market funds, long-term bonds and equities.
Adjustable
Term
Universal
Variable - ✔✔variable
✔✔When is the face amount paid under a Joint Life and Survivor policy?
when policy reaches maturation
upon death of the first insured
upon death of the last insured
when one of the insureds becomes disabled and no longer able to make premium
payments - ✔✔upon death of last insured
✔✔Which policy requires an agent to register with the National Association of Securities
Dealers (NASD) before selling?
Variable Life
Credit Life
, Universal Life
Interest-Sensitive Whole Life - ✔✔variable life
✔✔T has a term policy that allows him to continue the coverage after expiration of the
initial policy period. What type of term coverage is this?
Renewable
Increasing
Level
Decreasing - ✔✔renewable
✔✔Life insurance that covers an insured's whole life with level premiums paid over a
limited time is called:
Adjustable Life
Renewable Term
Limited Pay Life
Joint Life - ✔✔limited pay life
✔✔Which type of life policy contains a monthly mortality charge as well as self-directed
investment choices?
Joint Life
Adjustable Life
Variable Universal Life
Universal Life - ✔✔variable universal
✔✔What does a Face Amount Plus Cash Value Policy supposed to pay at the insured's
death?
Face amount plus the policy's cash value
Face amount plus the policy's dividends
The greater amount of the policy's death benefit or the cash value
Face amount plus total premium paid throughout the life of the policy - ✔✔face amount
plus the policy's cash value
✔✔Term insurance has which of the following characteristics?
Expires at the end of the policy period
Builds cash value
Has nonforfeiture options
Endows at the end of the policy period - ✔✔expires at the end of the policy period
✔✔K buys a policy where the premium stays fixed for the first 5 years. The premium
then increases in year 6 and stays level thereafter, all the while the death benefit
remains the same. What kind of policy is this?
Variable Life
Adjustable Life
Graded Premium Whole Life
QUESTIONS AND SOLUTIONS MARKED A+
✔✔A life insurance arrangement which circumvents insurable interest statutes is called:
a contract of adhesion
an indemnity contract
key person insurance
Investor-Originated Life Insurance - ✔✔IOLI
✔✔Q purchases a $500,000 life insurance policy and pays $900 in premiums over the
first six months. Q dies suddenly and the beneficiary is paid $500,000. This exchange of
unequal values reflects which of the following insurance contract features?
Aleatory
Adhesion
Unilateral
Consideration - ✔✔aleatory
✔✔In regards to representations or warranties, which of these statements is TRUE?
Warranties are statements considered to be true to the best of the applicant's belief
If material to the risk, false representations will void a policy
Representations are statements guaranteed to be true in every respect
If material to the risk, false representations will NOT void a policy - ✔✔if material to the
risk, false representations will void a policy
✔✔A life insurance policy would be considered a wagering contract WITHOUT:
insurable interest
premium payment
agent solicitation
constructive delivery - ✔✔insurable interest
✔✔Which of these is NOT a type of agent authority?
Express
Implied
Principal
Apparent - ✔✔principal
✔✔Which of the following actions is NOT possible with a Universal Life policy?
Policy's cash value may be used to pay premiums
Premium payments may be made at unscheduled times
Premiums may be applied as a credit against income tax
Face amount may be adjusted - ✔✔premiums may be applied as a credit against
income tax
,✔✔What kind of insurance policy supplies an income stream over a set period of time
that starts when the insured dies?
Family Maintenance Policy
Family Income Policy
Survivor Policy
Family Survivor Policy - ✔✔family maintenance policy
✔✔A Family Income Policy is a combination of Whole Life and
Decreasing Term insurance
Level Term insurance
Deposit Term insurance
Increasing Term insurance - ✔✔decreasing term insurance
✔✔The Universal Life Policy is called an unbundled Life Policy because the
policyholder can see the expense charges, the interest earned, and the:
Premium tax
Dividend rate
Values based on mutual funds or stocks
Cost of insurance - ✔✔cost of insurance
✔✔What kind of life insurance product covers children under their parent's policy?
Family Maintenance rider
Term rider
Family Income rider
Payor benefit - ✔✔term rider
✔✔A(n) ______ Life policy offers the owner investment in products such as money-
market funds, long-term bonds and equities.
Adjustable
Term
Universal
Variable - ✔✔variable
✔✔When is the face amount paid under a Joint Life and Survivor policy?
when policy reaches maturation
upon death of the first insured
upon death of the last insured
when one of the insureds becomes disabled and no longer able to make premium
payments - ✔✔upon death of last insured
✔✔Which policy requires an agent to register with the National Association of Securities
Dealers (NASD) before selling?
Variable Life
Credit Life
, Universal Life
Interest-Sensitive Whole Life - ✔✔variable life
✔✔T has a term policy that allows him to continue the coverage after expiration of the
initial policy period. What type of term coverage is this?
Renewable
Increasing
Level
Decreasing - ✔✔renewable
✔✔Life insurance that covers an insured's whole life with level premiums paid over a
limited time is called:
Adjustable Life
Renewable Term
Limited Pay Life
Joint Life - ✔✔limited pay life
✔✔Which type of life policy contains a monthly mortality charge as well as self-directed
investment choices?
Joint Life
Adjustable Life
Variable Universal Life
Universal Life - ✔✔variable universal
✔✔What does a Face Amount Plus Cash Value Policy supposed to pay at the insured's
death?
Face amount plus the policy's cash value
Face amount plus the policy's dividends
The greater amount of the policy's death benefit or the cash value
Face amount plus total premium paid throughout the life of the policy - ✔✔face amount
plus the policy's cash value
✔✔Term insurance has which of the following characteristics?
Expires at the end of the policy period
Builds cash value
Has nonforfeiture options
Endows at the end of the policy period - ✔✔expires at the end of the policy period
✔✔K buys a policy where the premium stays fixed for the first 5 years. The premium
then increases in year 6 and stays level thereafter, all the while the death benefit
remains the same. What kind of policy is this?
Variable Life
Adjustable Life
Graded Premium Whole Life
