MICHIGAN LIFE INSURANCE STATE
CERTIFICATION SCRIPT 2026 QUESTIONS
WITH SOLUTIONS GRADED A+
◍ Under Social Security disability requirements, a worker is fully insured on a
permanent basis after having worked in a covered occupation for:
A. 30 quarters
B. 10 quarters
C. 20 quarters
D. 40 quarters.
Answer: D. 40 quarters
◍ Which of the following would disqualify a company's retirement plan from
receiving favorable tax treatment?
A. It is temporary
B. Formed for the sole benefit of employees and their beneficiaries
C. Contributions are applied with no regard to income
D. Contains a vesting schedule.
Answer: A. It is temporary
◍ Characteristics of Group Plans.
Answer: Group underwriting differs from that of individual insurance, and is
based on the group characteristics and makeup.Another unique aspect of
group underwriting is that the cost of the coverage is based on the average
age of the group and the ratio of men to women. In addition, in order to
reduce adverse selection, the insurer will require a minimum number of
participants in the group, depending on whether the employer or employees
pay the premium.
◍ Jessica, a widow, stopped receiving survivor Social Security benefits when
her son turned 16. At what age will she be eligible to start receiving benefits
, again?
A. 60
B. 62
C. 59 1/2
D. 65.
Answer: A. 60
◍ Credit Life Insurance Characteristics.
Answer: The creditor is the owner and the beneficiary of the policy although
the premiums are generally paid by the borrower (or the debtor). Credit life
insurance cannot pay out more than the balance of the debt, so that there is
no financial incentive for the death of the insured. The creditors may require
the debtor to have life insurance; they cannot, however, require that the
debtor buys insurance from a specific insurer.If the individual policy or
group certificate is not delivered to the debtor at the time the indebtedness is
incurred, a copy of the application or a notice of proposed insurance will be
delivered, instead, at that time. That document must refer exclusively to the
insurance coverage and must be separate from the loan, sale or other credit
statement of account. The policy must be delivered to the debtor within 30
days after the indebtedness is incurred and upon the acceptance of the
insurance.
◍ Characteristics of Concern to a Group Underwriter.
Answer: -Purpose of the group: The group must be created for a purpose
other than to obtain group insurance.-Size of the group: The larger the
number of people in the group, the more accurate the projections of future
loss experience will be. This is based on the Law of Large Numbers of
similar risks.-Turnover of the group: From the underwriting perspective, a
group should have a steady turnover: younger, lower-risk employees enter
the group, and older, higher-risk employees leave.-Financial strength of the
group: Because group insurance is costly to administer, the underwriter
should consider whether or not the group has the financial resources to pay
the policy premiums, and whether or not it will be able to renew the
coverage.
,◍ Jonas is a whole life insurance policyowner and would like to add coverage
for his two children. Which of the following products would allow him to
accomplish this?
A. Family maintenance rider
B. Family income rider
C. Child term rider
D. Payor rider.
Answer: C. Child term rider D
◍ Before any Insurer Can Deliver or Issue any Variable Life Insurance Policy,
Must Submit What Information for the Consideration of the Commissioner
of Insurance?.
Answer: -Copies and a general description of all variable life insurance
policies;-A general description of the methods of operation of the variable
life insurance business of the insurer, including methods of distribution of
policies, and the names of those persons or firms proposed to supply
consulting, investment, administrative, distributive, or custodial services to
the insurer;-A statement of assets held in such separate account, including a
description of the investment objective and orientation intended for the
separate account;-A description of any investment advisory services used or
intended for use; -A copy of the statutes and regulations of the state of
domicile of the insurer under which it is authorized to issue variable life
insurance policies (upon Commissioner's request);-A certification by the
state regulatory authority that the insurer is in compliance with the laws and
regulations applicable to variable life insurance;-Biographical data of
officers and directors of the insurer, which will be submitted on the National
Association of Insurance Commissioners(NAIC) uniform biographical data
form (if requested);-A statement describing the procedures for changing the
investment policy of any separate account maintained by an insurer for any
variable life insurance policy;-A statement of the insurer's actuary
describing the mortality and expense risks which the insurer will bear under
the policy;-Any additional information required by the Commissioner.
, ◍ Which of the following is NOT a federal requirement of a qualified plan?
A. Employer establishes the plan
B. Must benefit a broad cross-section of employees
C. Employee must be able to make unlimited contributions
D. Vesting schedule must be defined.
Answer: C. Employee must be able to make unlimited contributions
◍ Option B Increasing Death Benefit Option.
Answer: the death benefit includes the annual increase in cash value so that
the death benefit gradually increases each year by the amount that the cash
value increases. At any point in time, the total death benefit will always be
equal to the face amount of the policy plus the current amount of cash value.
Since the pure insurance with the insurer remains level for life, the expenses
of this option are much greater than those for Option A, thereby causing the
cash value to be lower in the older years (all else being equal).
◍ Bob and Tom start a business. Since each partner contributes an important
element to the success of the business, they decide to take life insurance
policies out on each other, and name each other as beneficiaries. Eventually,
they retire and dissolve the business. Bob dies 12 months later. The policies
continue in force with no change. Both partners are still married at the time
of Bob's death. In this situation, who will receive Bob's policy proceeds?
A. Tom's spouse
B. Bob's spouse
C. Tom.
Answer: C. Tom
◍ Whole Life Insurance Basic Forms.
Answer: re straight whole life, limited-pay whole life and single premium
whole life; however, other forms and combination plans may also be
available.
◍ Converting a group plan to permanent life insurance requires?
A. Submitting proof of insurability
B. Paying a lower premium
CERTIFICATION SCRIPT 2026 QUESTIONS
WITH SOLUTIONS GRADED A+
◍ Under Social Security disability requirements, a worker is fully insured on a
permanent basis after having worked in a covered occupation for:
A. 30 quarters
B. 10 quarters
C. 20 quarters
D. 40 quarters.
Answer: D. 40 quarters
◍ Which of the following would disqualify a company's retirement plan from
receiving favorable tax treatment?
A. It is temporary
B. Formed for the sole benefit of employees and their beneficiaries
C. Contributions are applied with no regard to income
D. Contains a vesting schedule.
Answer: A. It is temporary
◍ Characteristics of Group Plans.
Answer: Group underwriting differs from that of individual insurance, and is
based on the group characteristics and makeup.Another unique aspect of
group underwriting is that the cost of the coverage is based on the average
age of the group and the ratio of men to women. In addition, in order to
reduce adverse selection, the insurer will require a minimum number of
participants in the group, depending on whether the employer or employees
pay the premium.
◍ Jessica, a widow, stopped receiving survivor Social Security benefits when
her son turned 16. At what age will she be eligible to start receiving benefits
, again?
A. 60
B. 62
C. 59 1/2
D. 65.
Answer: A. 60
◍ Credit Life Insurance Characteristics.
Answer: The creditor is the owner and the beneficiary of the policy although
the premiums are generally paid by the borrower (or the debtor). Credit life
insurance cannot pay out more than the balance of the debt, so that there is
no financial incentive for the death of the insured. The creditors may require
the debtor to have life insurance; they cannot, however, require that the
debtor buys insurance from a specific insurer.If the individual policy or
group certificate is not delivered to the debtor at the time the indebtedness is
incurred, a copy of the application or a notice of proposed insurance will be
delivered, instead, at that time. That document must refer exclusively to the
insurance coverage and must be separate from the loan, sale or other credit
statement of account. The policy must be delivered to the debtor within 30
days after the indebtedness is incurred and upon the acceptance of the
insurance.
◍ Characteristics of Concern to a Group Underwriter.
Answer: -Purpose of the group: The group must be created for a purpose
other than to obtain group insurance.-Size of the group: The larger the
number of people in the group, the more accurate the projections of future
loss experience will be. This is based on the Law of Large Numbers of
similar risks.-Turnover of the group: From the underwriting perspective, a
group should have a steady turnover: younger, lower-risk employees enter
the group, and older, higher-risk employees leave.-Financial strength of the
group: Because group insurance is costly to administer, the underwriter
should consider whether or not the group has the financial resources to pay
the policy premiums, and whether or not it will be able to renew the
coverage.
,◍ Jonas is a whole life insurance policyowner and would like to add coverage
for his two children. Which of the following products would allow him to
accomplish this?
A. Family maintenance rider
B. Family income rider
C. Child term rider
D. Payor rider.
Answer: C. Child term rider D
◍ Before any Insurer Can Deliver or Issue any Variable Life Insurance Policy,
Must Submit What Information for the Consideration of the Commissioner
of Insurance?.
Answer: -Copies and a general description of all variable life insurance
policies;-A general description of the methods of operation of the variable
life insurance business of the insurer, including methods of distribution of
policies, and the names of those persons or firms proposed to supply
consulting, investment, administrative, distributive, or custodial services to
the insurer;-A statement of assets held in such separate account, including a
description of the investment objective and orientation intended for the
separate account;-A description of any investment advisory services used or
intended for use; -A copy of the statutes and regulations of the state of
domicile of the insurer under which it is authorized to issue variable life
insurance policies (upon Commissioner's request);-A certification by the
state regulatory authority that the insurer is in compliance with the laws and
regulations applicable to variable life insurance;-Biographical data of
officers and directors of the insurer, which will be submitted on the National
Association of Insurance Commissioners(NAIC) uniform biographical data
form (if requested);-A statement describing the procedures for changing the
investment policy of any separate account maintained by an insurer for any
variable life insurance policy;-A statement of the insurer's actuary
describing the mortality and expense risks which the insurer will bear under
the policy;-Any additional information required by the Commissioner.
, ◍ Which of the following is NOT a federal requirement of a qualified plan?
A. Employer establishes the plan
B. Must benefit a broad cross-section of employees
C. Employee must be able to make unlimited contributions
D. Vesting schedule must be defined.
Answer: C. Employee must be able to make unlimited contributions
◍ Option B Increasing Death Benefit Option.
Answer: the death benefit includes the annual increase in cash value so that
the death benefit gradually increases each year by the amount that the cash
value increases. At any point in time, the total death benefit will always be
equal to the face amount of the policy plus the current amount of cash value.
Since the pure insurance with the insurer remains level for life, the expenses
of this option are much greater than those for Option A, thereby causing the
cash value to be lower in the older years (all else being equal).
◍ Bob and Tom start a business. Since each partner contributes an important
element to the success of the business, they decide to take life insurance
policies out on each other, and name each other as beneficiaries. Eventually,
they retire and dissolve the business. Bob dies 12 months later. The policies
continue in force with no change. Both partners are still married at the time
of Bob's death. In this situation, who will receive Bob's policy proceeds?
A. Tom's spouse
B. Bob's spouse
C. Tom.
Answer: C. Tom
◍ Whole Life Insurance Basic Forms.
Answer: re straight whole life, limited-pay whole life and single premium
whole life; however, other forms and combination plans may also be
available.
◍ Converting a group plan to permanent life insurance requires?
A. Submitting proof of insurability
B. Paying a lower premium
