MICHIGAN LIFE INSURANCE STATE EXAM ANSWER KEY

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MICHIGAN LIFE INSURANCE STATE EXAM ANSWER KEY

EXAM QUESTIONS

Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -100 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: Which type of annuity guarantees a level benefit payment?

• Variable
• Universal
• Limited life
• Fixed

Answer:

• Fixed

Question 2: For a contract to be valid it MUST...

Answer:

Include an offer and acceptance Question 3: Prior to annuitization what is the non-forfeiture value of an annuity?

• Only premium vested in the account for 3 years
• All premiums paid
• As payments are contributed

• Earnings are not taxable

Answer:

• All premiums paid minus any withdrawals and surrender charges

Question 4: Insurance applicants with an average life expectancy who represent the same risk classification as the majority of people with similar lifestyles are considered which type of risk?

• Declined
• Preferred
• Standard
• Substandard

Answer:

• Standard

Question 5: An insurance policy is a on lateral contract because ONLY the...?

• Insured pays the premium
• Insured is legally bound
• Insurer is legally bound
• Insurer can cancel the policy

Answer:

• Insurer is legally bound

Question 6: An insurer that is owned by their policyholder and can pay annual dividends to them..?

• Stock company
• Mutual company
• Fraternal insurer
• Lloyd's of income

Answer:

• Mutual company

Question 7: An Insurance policy lapsed due to nonpayment of premium to activate the reinstatement clause...

• Play the premium within 15 days of the grace period.
• Provide the insurer with the evidence of insurability
• Apply for a new life insurance policy
• Demonstrate the incontestable clause can be invoked

Answer:

• Provide the insurer with the evidence of insurability

Question 8: Which statement is not a characteristic of a group life insurance plan?

• A master contract
• Probationary period
• Individual underwriting
• Certificate of insurance

Answer:

• Individual underwriting

Question 9: Upon the death of an insured individual, what does life insurance guarantee to deliver to the beneficiary?

• An annuity
• A specific sum of money
• A dividend
• A final expense fund

Answer:

• A specific sum of money

Question 10: All of the following policies qualify for 1035 exchange EXCEPT?

• A whole life policy to another whole life policy
• A whole life policy to an annuity
• An annuity to another annuity
• An annuity to a whole life policy

Answer:

• An annuity to a whole life policy

Question 11: In contract law, legal purposes refer to the fact that...?

• The contract must be personal
• There must be consideration on the part of both parties
• The reason for entering into a contract must be lawful
• The parties entering the contract must be competent

Answer:

• The reason for entering into a contract must be lawful

Question 12: Which is the simplest type of life insurance plan that provides protection for a specific period of time and pays a benefit only if the insured dies during that period?

• Whole life insurance
• Level term life insurance
• Variable term life insurance
• Ordinary life insurance

Answer:

• Level term life insurance