Michigan Property & Casualty Insurance License Exam — All Questions
3 questions
Which agency licenses resident property and casualty insurance producers in Michigan?
- a.Michigan Secretary of State
- b.Michigan Department of Insurance and Financial Services (DIFS)✓
- c.Michigan Department of Treasury
- d.Michigan Public Service Commission
Michigan regulates insurers and licenses producers through the Department of Insurance and Financial Services (DIFS), led by the DIFS Director. The Secretary of State handles vehicle titling and registration but does not license insurance producers.
A Michigan producer offers to pay part of the first-year premium out of her own commission to persuade a client to buy a homeowners policy. Under Michigan's unfair trade practices law this is:
- a.Permitted if the insurer is told
- b.Permitted for new clients only
- c.Prohibited rebating✓
- d.Required to be reported but otherwise lawful
Giving any part of the premium or commission, or other valuable consideration not stated in the policy, as an inducement to buy is prohibited rebating under Michigan's unfair trade practices provisions and can bring fines and license action by the Michigan DIFS.
After a Michigan personal auto or homeowners policy is past its initial underwriting period, an insurer's mid-term cancellation is generally allowed only:
- a.For specific statutory grounds such as nonpayment of premium, fraud, or a substantial increase in the hazard, with required advance written notice✓
- b.For any reason with no notice
- c.Only in the first week after issuance
- d.Never, under any circumstances
Michigan restricts mid-term cancellation of seasoned personal-lines policies to defined grounds such as nonpayment, fraud, or a material increase in the insured hazard, and requires advance written notice so the insured can replace coverage. The exact notice day-counts are set by statute; verify current figures with the Michigan DIFS.