State RegulationsMI specificDifficulty 1/5
When a Michigan group life certificate holder exercises the conversion right, which policy form may NOT be selected?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
M.C.L. 500.4438(1)(b) permits the converting certificate holder to elect any customary form of individual life insurance except term insurance, in an amount equal to the group coverage at termination. The purpose of conversion is to lock in permanent protection without evidence of insurability, so allowing the converted policy itself to be temporary term coverage would defeat the statute's protective aim. Every other customary permanent form remains available to the electing employee.
Why the other options are wrong
- A) Whole life is a customary form and is available on conversion.
- B) Endowment insurance is a customary form and is available on conversion.
- C) Limited-payment life is a customary form and is available on conversion.
Memory hook
Convert to anything but term.