MICHIGAN LIFE INSURANCE STATE
ACTUAL EXAM PAPER 2026 QUESTIONS
WITH ANSWERS GRADED A+
◍ what is fraud.
Answer: intentional deception for financial gain
◍ A change in a producer's home address must be reported to:A)the producer's
customers within 1 year of the change. B)the insurance company within 6
months of the change. C)the Commissioner within 30 days of the change.
D)the producer's manager..
Answer: CTo maintain her license, a producer must report any change in her
home address to the Commissioner within 30 days of the change and pay a
recording fee. Failure to do so can result in a fine.
◍ what is annuity payout phase.
Answer: period when payments begin
◍ The MINIMUM number of lives that must be covered under a group life
insurance policy in Michigan is:A)20 lives. B)10 lives. C)2 lives. D)5 lives..
Answer: CA group policy in Michigan must include a minimum of two
lives.
◍ In Michigan, all life and health advertisements must be:A)filed with the
attorney general's office. B)maintained at the insurer's home office. C)filed
with the commissioner. D)preapproved by the commissioner before being
made public..
Answer: BA complete file of all life insurance advertisements must be
maintained at the insurer's home office for a minimum of four years.
◍ The maximum life insurance policy loan interest that may be charged on a
fixed interest loan basis is:A)18%. B)8%. C)4%. D)7.4%..
, Answer: BThe maximum interest rate for a fixed rate policy loan is 8% per
year (18% per year for an adjustable rate loan).
◍ From which source does the Michigan Life and Health Insurance Guaranty
Association obtain its funds?A)State of Michigan General Revenue Fund.
B)Proceeds of lottery ticket sales. C)Insurance agent licensing fees.
D)Assessments of Association members..
Answer: DAssociation members pay assessments that are used to carry out
the duties and responsibilities of the Association. The Association protects
Michigan policyowners by guaranteeing, assuming or reinsuring an insurer's
policies and by loaning money to impaired or insolvent insurers and paying
their obligations.
◍ Which of the following statements is NOT correct regarding a temporary
insurance license in Michigan?A)A temporary license issued to wind down
the affairs of a deceased producer may be issued for up to 180 days at the
discretion of the Commissioner. B)An individual needs to pass an exam to
be issued a temporary license. C)The Commissioner may require a person
with a temporary license to have a sponsor who is a licensed producer.
D)The Commissioner may revoke a temporary license if he suspects the
license is endangering the public..
Answer: BA temporary license issued for someone else to complete the
affairs of a deceased (or physically or mentally handicapped) licensed
producer is issued for up to 180 days at the discretion of the Commissioner.
There is no exam or prelicensing education required for a temporary license.
◍ The Commissioner must examine the books, records, documents, and papers
of domestic insurance companies at leastA)once every five years B)once
every year C)twice every year D)once every three years.
Answer: AAll other insurance companies doing business in Michigan may
be examined at any time.
◍ The Commissioner may issue a temporary license, without an examination,
for up to how many days?A)60 B)365 C)180 D)90.
Answer: C 180
,◍ Which of the following statements is NOT correct regarding a managing
general agent?A)An MGA must be licensed. B)An MGA can negotiate
reinsurance. C)An MGA must be an employee of an insurer. D)An MGA
may manage all of the insurance business of an insurer..
Answer: CAn employee of the insurer is not considered a managing general
agent.
◍ In regards to health care benefits, anyone insured who commits a fraudulent
insurance act is guilty of a felony and subject toA)a fine of $100,000
B)imprisonment for up to a year and/or a fine of $50,000 C)imprisonment
for up to four years and/or a fine of up to $50,000 D)imprisonment for up to
20 years.
Answer: Up to 4 years And Find up to 50,000
◍ what is risk transfer.
Answer: shifting risk to another party such as an insurer
◍ A producer in Michigan must complete 24 hours of continuing education
every two years. Of those 24 hours, how many hours have to be devoted to
the study of ethics in insurance?A)6 B)There is not an ethics requirement
C)2 D)3.
Answer: 3
◍ Which of the following statements is CORRECT concerning a terminated
appointment?A)It removes the producer's authority to represent a specific
insurer. B)It cancels the producer's license with the state. C)It is effective
after the insurer informs the producer of the termination. D)It cancels the
producer's authority to represent any insurer in the state..
Answer: ATermination of an appointment cancels the producer's authority to
represent a specific insurer. An insurer who terminates a producer's
appointment must inform the commissioner within 30 days of the date of
termination.
◍ Which of the following is the responsibility of the replacing insurer when
replacing a life insurance policy in Michigan?A)Notify the existing insurer
, of the replacement transaction within 3 business days following receipt of
the application. B)Provide the applicant with copies of any sales proposals
used for presentation to the applicant. C)Provide the applicant with a copy,
on appropriate forms, of the notice to applicants regarding replacement of
life insurance. D)Obtain a signed information statement from the applicant
indicating that replacement is involved..
Answer: AAll of the other answer choices are responsibilities of the
producer.
◍ If, after a hearing, the Commissioner believes a producer has violated
licensing laws, the Commissioner can:A)initiate a federal court action.
B)sue the producer on behalf of the public. C)cancel any policy purchased
by a customer of the producer. D)fine the producer a maximum of $2,500
for each violation..
Answer: DIf, after a hearing, the Commissioner determines that a producer
knowingly violated an insurance regulation, the Commissioner may assess a
maximum penalty of $2,500 for each violation, up to a combined total of
$25,000. If a producer committed a violation but did so unknowingly, the
fine is a maximum $500 per violation.
◍ What kind of insurance policy issued by a mutual insurer provides a return
of divisible surplus? Nonparticipating life insurance policy participating life
insurance policy divisible surplus life insurance policy straight life insurance
policy.
Answer: Participating life insurance policy
◍ Under which of the following types of policies does an insured have to be
notified whether current policy values are insufficient to maintain the policy,
given guaranteed interest and expense rates?A)Credit life insurance.
B)Universal life insurance. C)Blanket health insurance. D)Long-term care
insurance..
Answer: BA universal life annual report must tell the policyowner whether
the policy's current premium schedule or current cash values will be
sufficient to maintain the policy for another year, given guaranteed interest,
ACTUAL EXAM PAPER 2026 QUESTIONS
WITH ANSWERS GRADED A+
◍ what is fraud.
Answer: intentional deception for financial gain
◍ A change in a producer's home address must be reported to:A)the producer's
customers within 1 year of the change. B)the insurance company within 6
months of the change. C)the Commissioner within 30 days of the change.
D)the producer's manager..
Answer: CTo maintain her license, a producer must report any change in her
home address to the Commissioner within 30 days of the change and pay a
recording fee. Failure to do so can result in a fine.
◍ what is annuity payout phase.
Answer: period when payments begin
◍ The MINIMUM number of lives that must be covered under a group life
insurance policy in Michigan is:A)20 lives. B)10 lives. C)2 lives. D)5 lives..
Answer: CA group policy in Michigan must include a minimum of two
lives.
◍ In Michigan, all life and health advertisements must be:A)filed with the
attorney general's office. B)maintained at the insurer's home office. C)filed
with the commissioner. D)preapproved by the commissioner before being
made public..
Answer: BA complete file of all life insurance advertisements must be
maintained at the insurer's home office for a minimum of four years.
◍ The maximum life insurance policy loan interest that may be charged on a
fixed interest loan basis is:A)18%. B)8%. C)4%. D)7.4%..
, Answer: BThe maximum interest rate for a fixed rate policy loan is 8% per
year (18% per year for an adjustable rate loan).
◍ From which source does the Michigan Life and Health Insurance Guaranty
Association obtain its funds?A)State of Michigan General Revenue Fund.
B)Proceeds of lottery ticket sales. C)Insurance agent licensing fees.
D)Assessments of Association members..
Answer: DAssociation members pay assessments that are used to carry out
the duties and responsibilities of the Association. The Association protects
Michigan policyowners by guaranteeing, assuming or reinsuring an insurer's
policies and by loaning money to impaired or insolvent insurers and paying
their obligations.
◍ Which of the following statements is NOT correct regarding a temporary
insurance license in Michigan?A)A temporary license issued to wind down
the affairs of a deceased producer may be issued for up to 180 days at the
discretion of the Commissioner. B)An individual needs to pass an exam to
be issued a temporary license. C)The Commissioner may require a person
with a temporary license to have a sponsor who is a licensed producer.
D)The Commissioner may revoke a temporary license if he suspects the
license is endangering the public..
Answer: BA temporary license issued for someone else to complete the
affairs of a deceased (or physically or mentally handicapped) licensed
producer is issued for up to 180 days at the discretion of the Commissioner.
There is no exam or prelicensing education required for a temporary license.
◍ The Commissioner must examine the books, records, documents, and papers
of domestic insurance companies at leastA)once every five years B)once
every year C)twice every year D)once every three years.
Answer: AAll other insurance companies doing business in Michigan may
be examined at any time.
◍ The Commissioner may issue a temporary license, without an examination,
for up to how many days?A)60 B)365 C)180 D)90.
Answer: C 180
,◍ Which of the following statements is NOT correct regarding a managing
general agent?A)An MGA must be licensed. B)An MGA can negotiate
reinsurance. C)An MGA must be an employee of an insurer. D)An MGA
may manage all of the insurance business of an insurer..
Answer: CAn employee of the insurer is not considered a managing general
agent.
◍ In regards to health care benefits, anyone insured who commits a fraudulent
insurance act is guilty of a felony and subject toA)a fine of $100,000
B)imprisonment for up to a year and/or a fine of $50,000 C)imprisonment
for up to four years and/or a fine of up to $50,000 D)imprisonment for up to
20 years.
Answer: Up to 4 years And Find up to 50,000
◍ what is risk transfer.
Answer: shifting risk to another party such as an insurer
◍ A producer in Michigan must complete 24 hours of continuing education
every two years. Of those 24 hours, how many hours have to be devoted to
the study of ethics in insurance?A)6 B)There is not an ethics requirement
C)2 D)3.
Answer: 3
◍ Which of the following statements is CORRECT concerning a terminated
appointment?A)It removes the producer's authority to represent a specific
insurer. B)It cancels the producer's license with the state. C)It is effective
after the insurer informs the producer of the termination. D)It cancels the
producer's authority to represent any insurer in the state..
Answer: ATermination of an appointment cancels the producer's authority to
represent a specific insurer. An insurer who terminates a producer's
appointment must inform the commissioner within 30 days of the date of
termination.
◍ Which of the following is the responsibility of the replacing insurer when
replacing a life insurance policy in Michigan?A)Notify the existing insurer
, of the replacement transaction within 3 business days following receipt of
the application. B)Provide the applicant with copies of any sales proposals
used for presentation to the applicant. C)Provide the applicant with a copy,
on appropriate forms, of the notice to applicants regarding replacement of
life insurance. D)Obtain a signed information statement from the applicant
indicating that replacement is involved..
Answer: AAll of the other answer choices are responsibilities of the
producer.
◍ If, after a hearing, the Commissioner believes a producer has violated
licensing laws, the Commissioner can:A)initiate a federal court action.
B)sue the producer on behalf of the public. C)cancel any policy purchased
by a customer of the producer. D)fine the producer a maximum of $2,500
for each violation..
Answer: DIf, after a hearing, the Commissioner determines that a producer
knowingly violated an insurance regulation, the Commissioner may assess a
maximum penalty of $2,500 for each violation, up to a combined total of
$25,000. If a producer committed a violation but did so unknowingly, the
fine is a maximum $500 per violation.
◍ What kind of insurance policy issued by a mutual insurer provides a return
of divisible surplus? Nonparticipating life insurance policy participating life
insurance policy divisible surplus life insurance policy straight life insurance
policy.
Answer: Participating life insurance policy
◍ Under which of the following types of policies does an insured have to be
notified whether current policy values are insufficient to maintain the policy,
given guaranteed interest and expense rates?A)Credit life insurance.
B)Universal life insurance. C)Blanket health insurance. D)Long-term care
insurance..
Answer: BA universal life annual report must tell the policyowner whether
the policy's current premium schedule or current cash values will be
sufficient to maintain the policy for another year, given guaranteed interest,
