Michigan life insurance state Exam 2026|2027 Advanced
Practice Questions and Answers with Complete A+
Solutions 100% Correct!!!
What is withholding of material fact called?
1. Fraud
2. Concealment
3. Obstruction
4. Misrepresentation - correct answer -2. Concealment
Betty has a 200,000 whole life policy with a 50,000 cash value she wants to take out 30,000
to buy a van...
1. Whole life policies do not have any provisions
2. The net death benefit is increased by the amount of the loan
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,3. If the loan is not repaid the new death benefit will be reduced
4. This type of loan is interest free if used for hardship or medical purposes - correct
answer -3. If the loan is not repaid the new death benefit will be reduced
Which of the following factors are used in life insurance premium determination EXCEPT?
1. Expense
2. Morbidity
3. Mortality
4. Interest - correct answer -1. Expense
Which of the following dividend option allows the policy owner to use the dividends to pay all
or part of the next premium due to the policy?
1. Reduction of premium dividend
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,2. Cash dividend option
3. One year dividend option
4. Paid up option - correct answer -1. Reduction of premium dividends
What is the purpose of the automatic premium loan rider?
1. Allows partial surrender to make loan payments
2. Protects the policy owner against an unintentional lapse of coverage
3. The insured will cancel the loan if the insured is prematurely disabled
4. Insurer the right to purchase additional insurance with evidence of insurance - correct
answer -2. Protects the policy owner against an unintentional lapse of coverage
Under which circumstances can a person obtain a portion of their life insurance benefit
without federal income tax liability?
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, 1. The policy is for less than $10
2. The policy is behind in premium payments
3. When the policy owner has elected a non-forfeiture option
4. When the insured is terminally ill and has less than 24 months to live - correct answer -3.
When the policy owner has elected a nonforfeiture option
Which of the following characteristics applies to a modified life policy?
1. Premiums remain level for the life of the policy
2. The policy provided immediate cash value that can be powered to a policy loan
3. The face amount of the policy will automatically increase after the policy is in force for 5
years
4. As long as premiums are paid, insurance protection is provided until the policy matures at
age - correct answer -3. The face amount of the policy will automatically increase after the
policy is in force for 5 years
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Practice Questions and Answers with Complete A+
Solutions 100% Correct!!!
What is withholding of material fact called?
1. Fraud
2. Concealment
3. Obstruction
4. Misrepresentation - correct answer -2. Concealment
Betty has a 200,000 whole life policy with a 50,000 cash value she wants to take out 30,000
to buy a van...
1. Whole life policies do not have any provisions
2. The net death benefit is increased by the amount of the loan
1|Page
,3. If the loan is not repaid the new death benefit will be reduced
4. This type of loan is interest free if used for hardship or medical purposes - correct
answer -3. If the loan is not repaid the new death benefit will be reduced
Which of the following factors are used in life insurance premium determination EXCEPT?
1. Expense
2. Morbidity
3. Mortality
4. Interest - correct answer -1. Expense
Which of the following dividend option allows the policy owner to use the dividends to pay all
or part of the next premium due to the policy?
1. Reduction of premium dividend
2|Page
,2. Cash dividend option
3. One year dividend option
4. Paid up option - correct answer -1. Reduction of premium dividends
What is the purpose of the automatic premium loan rider?
1. Allows partial surrender to make loan payments
2. Protects the policy owner against an unintentional lapse of coverage
3. The insured will cancel the loan if the insured is prematurely disabled
4. Insurer the right to purchase additional insurance with evidence of insurance - correct
answer -2. Protects the policy owner against an unintentional lapse of coverage
Under which circumstances can a person obtain a portion of their life insurance benefit
without federal income tax liability?
3|Page
, 1. The policy is for less than $10
2. The policy is behind in premium payments
3. When the policy owner has elected a non-forfeiture option
4. When the insured is terminally ill and has less than 24 months to live - correct answer -3.
When the policy owner has elected a nonforfeiture option
Which of the following characteristics applies to a modified life policy?
1. Premiums remain level for the life of the policy
2. The policy provided immediate cash value that can be powered to a policy loan
3. The face amount of the policy will automatically increase after the policy is in force for 5
years
4. As long as premiums are paid, insurance protection is provided until the policy matures at
age - correct answer -3. The face amount of the policy will automatically increase after the
policy is in force for 5 years
4|Page
