State RegulationsMI specificDifficulty 2/5
Under M.C.L. 500.4030, when must a Michigan individual life policy provide for settlement of the death claim?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
M.C.L. 500.4030 requires Michigan life policies to provide for settlement of death claims upon receipt of due proof of death, or not later than 2 months after receipt of that proof. This settlement standard works alongside the claims-interest rule, which attaches 12% annual interest to benefits left unpaid beyond the statutory window.
Why the other options are wrong
- B) The settlement deadline runs from receipt of due proof of death, not from policy issuance 60 days earlier.
- C) Oral notice is not the trigger; the statutory clock starts with due proof of death and allows up to 2 months.
- D) A 12-month year-end measure is far longer than the 2-month maximum settlement period in M.C.L. 500.4030.
Memory hook
Due proof in hand — the insurer has 2 months to settle.