MI-Credit-Insurance-Exam

Michigan Credit Insurance Producer Exam

Complete 90-Question Practice Exam

Instructions:

Scoring Guide:

PHASE 1: GENERAL INSURANCE FUNDAMENTALS

(Questions 1-35)

Question 1: Which of the following is an example of pure risk?

Question 2: What does “indemnity” mean in insurance?

Question 3: Which of the following is NOT a requirement for an insurable risk?

Question 4: What is “risk avoidance”?

Question 5: Which type of insurance company is owned by its policyholders?

Question 6: Which department in an insurance company decides whether to approve or deny a new application?

Question 7: What is “Adverse Selection”?

Question 8: What is an “Exclusive Agency”?

Question 9: Which of these is NOT an information source for underwriters?

Question 10: What does “Preferred” risk classification mean?

Question 11: What is “Expressed Authority”?

Question 12: Which of the following is NOT a legal element of a valid contract?

Question 13: What does “Insurable Interest” mean?

Question 14: What is an “Adhesion” contract?

Question 15: In an “Aleatory” contract, what is true?

Question 16: What is the “Free Look” period?

Question 17: What is the grace period for a life insurance policy?

Question 18: If a policyholder misrepresents their age on a life insurance application, what happens?

Question 19: What does “Reinstatement” mean in life insurance?

Question 20: What is the grace period for a health insurance policy with monthly premiums?

Question 21: What is the grace period for a health insurance policy with weekly premiums?

Question 22: What is the “Elimination Period”?

Question 23: What is the “Probationary Period” in health insurance?

Question 24: How long does a health insurance customer have to provide “Notice of Claim”?

Question 25: How long does the insurer have to provide claim forms after notice of claim?

Question 26: How long does the customer have to submit “Proof of Loss”?

Question 27: How long does the insurer have to PAY a health insurance claim after receiving proof of loss?

Question 28: When can a customer file a legal action against the insurer?

Question 29: Which is an optional health insurance provision?

Question 30: An insurance company department that uses statistical and mathematical analysis to set rates is the:

Question 31: What is the “Law of Large Numbers”?

Question 32: A mutual company differs from a stock company because:

Question 33: What does the “Entire Contract” clause state?

Question 34: Which of the following would NOT be included in Adverse Selection?

Question 35: What type of insurance company is owned by shareholders?

PHASE 2: CREDIT INSURANCE SPECIFICS

(Questions 36-65)

Question 36: What is the primary purpose of credit insurance?

Question 37: Which type of credit insurance covers the death of the debtor?

Question 38: What does “involuntary job loss” mean in Credit Unemployment Insurance?

Question 39: What is the main party PROTECTED by credit insurance?

Question 40: In closed-end credit, what does a “Certificate of Insurance” prove?

Question 41: When must a Certificate of Insurance be delivered for closed-end credit?

Question 42: What is the difference between “Closed-End” and “Open-End” credit?

Question 43: Which type of credit transaction is an example of “Installment” credit?

Question 44: What does “Gross Coverage” mean in Credit Life Insurance?

Question 45: What does “Decreasing Term” mean in Credit Life Insurance?

Question 46: For Credit Life Insurance, when does the suicide exclusion end?

Question 47: What is the difference between “Own Occupation” and “Any Occupation” in Credit A&H?

Question 48: What is the “Elimination Period” in Credit A&H?

Question 49: In Credit A&H for a Closed-End Installment Loan, what does the monthly benefit equal?

Question 50: What is a “Probationary Period” in Credit A&H?

Question 51: What is “GAP Insurance”?

Question 52: What is “PMI” (Private Mortgage Insurance)?

Question 53: When is PMI typically required?

Question 54: What does TILA (Truth in Lending Act) require?

Question 55: What does the “NAIC Model Act” establish?

Question 56: What is “Credit Property Insurance”?

Question 57: What does “Group” credit insurance mean?

Question 58: What does “Individual” credit insurance mean?

Question 59: What is “Involuntary Income Unemployment” insurance (IUI)?

Question 60: What protection does the Fair Credit Reporting Act provide?

Question 61: What does “Regulation Z” deal with?

Question 62: Must credit insurance be offered to customers?

Question 63: What is “Credit Disability Insurance”?

Question 64: What does it mean that credit insurance covers “involuntary” job loss?

Question 65: Which federal regulation specifically requires disclosure of credit insurance costs?

PHASE 3: MICHIGAN INSURANCE REGULATIONS

(Questions 66-90)

Question 66: What does “DIFS” stand for?

Question 67: Who appoints the Michigan Insurance Commissioner?

Question 68: How long does the Insurance Commissioner serve?

Question 69: How many hours of pre-licensing education are required for a Producer license?

Question 70: How many hours of pre-licensing education are required for Life or Health ONLY?

Question 71: How many hours of Ethics/Regulatory requirements are required for pre-licensing?

Question 72: What is the minimum age to be licensed as an insurance producer?

Question 73: What is a “Certificate of Authority”?

Question 74: How long does an insurer have to file notice of a new agency appointment with DIFS?

Question 75: How long does the insurer have to notify DIFS of an agent termination?

Question 76: How long does an agent have to notify DIFS of their own termination?

Question 77: How many continuing education hours are required every 2 years?

Question 78: How many of those CE hours must be Ethics/Regulatory?

Question 79: How long does an agent have to notify DIFS of an address change?

Question 80: Can commissions be shared with unlicensed people?

Question 81: Are referral fees allowed if they’re NOT contingent on a purchase?

Question 82: What is the “Controlled Business Limit”?

Question 83: Can processing fees be charged on credit card payments?

Question 84: What is “Twisting” in insurance?

Question 85: What is “Rebating”?

Question 86: Is age discrimination illegal in Michigan?

Question 87: What does the Michigan Life and Health Guaranty Association do?

Question 88: What is the maximum total benefit limit from the Guaranty Association?

Question 89: What is the maximum cash value limit from the Guaranty Association?

Question 90: What is the fine for knowingly violating insurance regulations per violation?

PRACTICE EXAM ANSWER KEY

PHASE 1 ANSWERS (1-35)

Q Answer Q Answer Q Answer
1 B 13 B 25 C
2 B 14 B 26 C
3 B 15 B 27 C
4 B 16 B 28 C
5 B 17 C 29 B
6 B 18 B 30 C
7 B 19 B 31 B
8 B 20 B 32 B
9 C 21 A 33 C
10 A 22 B 34 B
11 B 23 B 35 C
12 C 24 B    

PHASE 2 ANSWERS (36-65)

Q Answer Q Answer Q Answer
36 B 48 B 60 B
37 B 49 C 61 B
38 B 50 B 62 C
39 B 51 B 63 B
40 B 52 B 64 B
41 C 53 B 65 C
42 A 54 B    
43 C 55 B    
44 A 56 B    
45 A 57 B    
46 B 58 B    
47 A 59 B    

PHASE 3 ANSWERS (66-90)

Q Answer Q Answer Q Answer
66 B 75 C 84 B
67 B 76 B 85 B
68 C 77 C 86 B
69 C 78 B 87 B
70 A 79 C 88 C
71 B 80 C 89 B
72 B 81 B 90 C
73 C 82 B    
74 B 83 C    

SCORING YOUR EXAM

Count your correct answers: _____ out of 90

Your percentage: (Correct answers ÷ 90) × 100 = _____%

Your Performance:

HOW TO ANALYZE YOUR RESULTS

Step 1: Count Correct by Phase

Phase 1 (Q1-35): ___ correct out of 35 **Phase 2 (Q36-65):** ___ correct out of 30 Phase 3 (Q66-90): _____ correct out of 25

Step 2: Identify Weak Areas

Review chapters where you scored below 80%:

Step 3: Create Study Plan

For each weak area:

  1. Review the chapter material
  2. Complete the chapter quiz again
  3. Review critical numbers related to that chapter
  4. Take practice exam again in 1 week

Step 4: Track Progress

Take Practice Exam Again After 1 Week of Focused Study

First Attempt Score: __% Second Attempt Score: __% Improvement: _____%

If your second attempt is below 75%, consider:

TEST-TAKING STRATEGIES FOR REAL EXAM

✅ During the Exam:

✅ Before You Answer:

✅ If You Get Stuck:

❌ Don’t:

GOOD LUCK ON YOUR EXAM! 🎯

You’ve studied hard, learned the material, and practiced the exam. Now go pass that Michigan Credit Insurance Producer Exam!

Remember:

You’ve got this! 💪