Free Michigan Property & Casualty Practice Exam 2026

Michigan property and casualty insurance exam sample questions and answers

6 of the 150 practice questions, one from each topic, with the answer explained.

1. 1. A Michigan car owner drives his uninsured car and is injured in a crash. Under the no-fault law, he:

   • A.Receives PIP limited to $50,000
   • B.Is not entitled to PIP benefits
   • C.Receives PIP from the other driver's insurer
   • D.Receives PIP from the assigned claims plan

   Answer: B. MCL 500.3113(b) disqualifies a person from PIP benefits if he was the owner or registrant of a motor vehicle involved in the accident without the security required by 500.3101. Under 500.3135(2)(c) he also cannot recover noneconomic damages in tort.

2. 2. Under the commercial crime forms, 'robbery' means:

   • A.Any theft of money
   • B.Taking property from the premises by forcible entry leaving visible marks
   • C.Taking property by trick or deceit
   • D.Taking property from a person by force or threat

   Answer: D. Robbery requires a person to be present and threatened or harmed. Forcible entry with marks is burglary, and taking by trick is theft but not robbery.

3. 3. Under Michigan's insurance fraud law, a person who is paid to steer accident victims to a clinic that bills insurers for false claims is acting as a:

   • A.Runner or capper
   • B.Public adjuster
   • C.Claims representative
   • D.Loss consultant

   Answer: A. MCL 500.4503(h) makes employing, using or acting as a runner, capper or steerer to fraudulently obtain benefits under an insurance contract a fraudulent insurance act, a felony under 500.4511.

4. 4. A Michigan home insurer mails a termination notice for a reason other than nonpayment, 90 days after the policy was first issued. The notice must be mailed at least:

   • A.60 days before termination
   • B.10 days before termination
   • C.30 days before termination
   • D.20 days before termination

   Answer: C. MCL 500.2123(1) requires written notice at least 30 days before termination, stating each specific reason. Only a notice mailed within the first 55 days after initial issuance may take effect in 20 days (500.2123(2)), and nonpayment notices follow the policy.

5. 5. For total disability, Michigan workers' compensation pays a weekly benefit equal to:

   • A.100% of gross weekly wage
   • B.60% of after-tax weekly wage
   • C.80% of after-tax weekly wage
   • D.66 2/3% of gross weekly wage

   Answer: C. MCL 418.351(1) pays 80% of the employee's after-tax average weekly wage, up to the state maximum, for the duration of total disability. The older two-thirds of gross wages standard survives only as a floor for some claims (418.351(3)).

6. 6. A policy that pays the stated face amount on a total loss regardless of the property's actual value is a:

   • A.Valued policy
   • B.Reporting form policy
   • C.Actual cash value policy
   • D.Blanket policy

   Answer: A. A valued policy pays the agreed amount on a total loss. A blanket policy covers several locations or property types under one limit but still settles on actual loss.