State RegulationsMI specificDifficulty 3/5
A newborn is born out of wedlock, is not claimed as a tax dependent, and does not reside with the insured. A Michigan insurer denies enrollment citing all three grounds. How many of the stated grounds are valid under M.C.L. 500.3403(2)?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
M.C.L. 500.3403(2) expressly prohibits denying newborn enrollment on each of the three grounds cited — birth out of wedlock, not being claimed as a tax dependent, and not residing with the insured or in the service area. None supports the denial, and the Michigan Department of Insurance and Financial Services (DIFS) can act against the insurer.
Why the other options are wrong
- A) Birth out of wedlock is expressly prohibited as a ground under M.C.L. 500.3403(2), so option A is wrong.
- B) Tax dependency is likewise a prohibited ground under M.C.L. 500.3403(2), so option B is wrong.
- D) All of the grounds are prohibited by M.C.L. 500.3403(2), the opposite of valid.
Memory hook
Three strikes against the insurer — all three denial grounds fail.