State RegulationsMI specificDifficulty 2/5
An office manager in Warren alters an insurer's internal sales record to conceal the fact that a policy was sold with benefits different from what the customer was promised. Under the Michigan Insurance Code's false statement provisions (M.C.L. 500.2014, 500.2018), this conduct is:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
M.C.L. 500.2014 and 500.2018 of the Michigan Insurance Code prohibit willful false statements and entries in documents and records connected with the business of insurance. The manager deliberately falsified a business record to hide a deceptive sale, which is exactly the conduct the provision targets, and the director may impose fines, suspension, or revocation through DIFS even though the record was internal.
Why the other options are wrong
- B) The prohibition covers records connected with the business of insurance whether or not customers ever see them; internal status is no defense.
- C) Informing the producer of the falsification does not cure the willful false entry; the statute prohibits making it in the first place.
- D) Falsified insurance records are a regulatory violation enforced by the Insurance Director, so the matter is squarely within state law, not merely internal discipline.
Memory hook
Fudging the file is a state-law offense, not just an office matter.