State RegulationsMI specificDifficulty 3/5
A Michigan producer is comparing time periods for a client who owns both an individual life policy and an individual non-health disability policy. Which statement is correct?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
M.C.L. 500.4028 allows reinstatement of a lapsed individual life policy within 3 years of the premium default, while M.C.L. 500.3408 caps the printed time limit on defenses in a Michigan non-health disability policy at 2 years — even though the model text recites 3 years. Confusing the two figures is a classic examination trap, so producers must keep each period tied to its product.
Why the other options are wrong
- A) The 3-year figure applies to life reinstatement only; Michigan caps the disability defense period at 2 years.
- B) The 2-year cap governs the disability defense period only; life reinstatement runs 3 years.
- D) This reverses the two rules: life reinstatement is the 3-year period and the disability defense cap is 2 years.
Memory hook
Life comes back in 3; disability defenses die at 2.