State RegulationsMI specificDifficulty 3/5
Which statement accurately describes MLHIGA aggregate limits under M.C.L. 500.7704?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
M.C.L. 500.7704 sets the MLHIGA aggregate cap at $300,000 per life per insurer insolvency for most benefit categories, carves out basic hospital, medical, and surgical benefits at $500,000, and provides that multiple nongroup life insurance policies owned by one person receive an aggregate limit of $5,000,000. Understanding these layers matters because an owner with several contracts cannot simply stack unlimited coverage above the per-life caps.
Why the other options are wrong
- A) $100,000 is the cash surrender value and non-basic health benefit figure, not the overall aggregate cap.
- B) $250,000 is the annuity cap; the aggregate cap is not uniform at that figure for every product type.
- C) The statement ignores both the $500,000 basic hospital/medical/surgical exception and the $5,000,000 aggregate limit for multiple nongroup life policies of one owner.
Memory hook
Three-hundred aggregate, five-hundred hospital, five-million nongroup life stack.