State RegulationsMI specificDifficulty 1/5
Under the unfair trade practices provisions of the Michigan Insurance Code, which of the following is an unlawful misrepresentation?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
M.C.L. 500.2005 makes it unlawful to misrepresent material facts, policy terms, benefits or advantages, or the financial condition of any person in connection with the sale of insurance. Accurate comparisons, correct premium quotes, and truthful disclosure of policy rights are lawful conduct — the violation requires a misrepresentation of material information.
Why the other options are wrong
- B) An accurate comparison involves no misrepresentation and is lawful.
- C) Quoting filed premiums accurately is not a misrepresentation under M.C.L. 500.2005.
- D) Disclosing the free-look period is a truthful, required disclosure, not a violation.
Memory hook
Misrepresenting anything material — even an insurer's finances — is unlawful.