State RegulationsMI specificDifficulty 1/5
A Dearborn resident buys an individual life insurance policy from a licensed producer and later decides to return it. Under Michigan law, what minimum free-look (right to examine) period applies, and what must the insurer do if the policy is returned within that period?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
M.C.L. 500.4015 requires every individual life policy to carry a notice on its first page granting a right to examine of at least 10 days from receipt. If the policyowner returns the policy within that period, the insurer must promptly refund all premiums, including the policy fee. This gives consumers a risk-free opportunity to review the contract before it takes final effect.
Why the other options are wrong
- A) The minimum period is 10 days, not 5, and no deduction of the policy fee is permitted on a timely return (M.C.L. 500.4015).
- B) The minimum period is 10 days rather than 15; 15 days appears only in the special universal-life disclosure rule.
- D) No 30-day free look applies to an ordinary individual life policy sold by an agent; the statutory minimum is 10 days.
Memory hook
Ten days, total refund — policy fee comes back too.