This case involves a dispute regarding defendant insurer’s avoidance of a credit life and disability insurance policy on the ground that the insured *449made misrepresentations concerning his health on the application.
We granted leave in this case to determine whether defendant Globe Life Insurance Company is entitled to summary disposition with regard to plaintiff Debra L. Smith’s complaint alleging: (1) breach of contract involving the credit life and disability insurance policy, and (2) violations of the Michigan Consumer Protection Act (mcpa), MCL 445.901 et seq.; MSA 19.418(1) et seq., concerning the manner in which defendant represented the benefits and conditions of the policy in question.
Reversing the Court of Appeals in part, we conclude that defendant is entitled to summary disposition regarding plaintiff’s breach of contract claim. Defendant’s evidence established that plaintiff’s deceased father, Robert Smith, made material misrepresentations in his insurance application. Contrary to the Court of Appeals conclusion, there is no genuine issue of material fact regarding the application’s authenticity. In addition, defendant was not required to establish that it issued the insurance policy in reliance on Smith’s misrepresentations.
However, we agree with the Court of Appeals that defendant is not entitled to summary disposition regarding its alleged violations of the Michigan Consumer Protection Act. Although § 4(l)(a) of the act generally exempts from the MCPA transactions that are “specifically authorized” by law, § 4(2) provides an exception to that exemption by permitting certain private actions to be brought pursuant to § 11. That exception is applicable to plaintiff’s claim.
Accordingly, we affirm in part and reverse in part the judgment of the Court of Appeals.
*450I. FACTUAL AND PROCEDURAL BACKGROUND
On December 4, 1992, plaintiffs deceased father, Robert Smith, bought a new truck financed through Ford Motor Credit Company (fmcc). At the time, Smith was forty-seven years old and employed full-time. As part of his financing package, he purchased a combined credit life and disability policy issued by defendant. Only the credit life insurance policy is at issue here. The certificate of insurance provided the following eligibility requirements:
Who is eligible for life insurance: On the Date of Debt you and any Co-Debtor must each: (i) owe the Debt; (ii) be fully capable of being actively at work for wages or profit at least 30 hours per week; and (iii) be less than 71 years old. At the end of the Term of Insurance, you and any Co-Debtor must each be less than 71 years old.
On Smith’s application for insurance, slash marks had been made in boxes labeled “no” as responses to the following inquiries:
1. Have you been medically diagnosed as having and are you receiving treatment for:
a. Any condition of the heart, brain, liver, kidney, lungs, cancer or any malignant growth?
b. Diabetes, high blood pressure, circulatory disorders, neurological disorders, mental disorders or disorders of the back or neck?
Above Smith’s signature, the application also warned:
Answer all questions honestly and truthfully, misrepresentation is a basis for denial of benefits. Any underwriting decision based on this evidence of insurability shall be made within 60 days from the date of this application.
*451The credit life insurance policy provided in relevant part that defendant would be responsible for the balance due on the fmcc loan if Smith died while the policy was in force.
Smith had made two payments on the fmcc loan when he suffered a fatal heart attack on January 27, 1993. As personal representative of her father’s estate, plaintiff notified defendant of Smith’s death and made a claim for benefits pursuant to the certificate of insurance. Defendant denied coverage, asserting that the policy was void because Smith had misrepresented his state of health on the application. Defendant rescinded the policy, returning premiums paid for the policy to the car dealership.
After defendant denied the claim, plaintiff filed a complaint alleging breach of contract and violations of the Michigan Consumer Protection Act.1 Relying on conditions of coverage provided in the certificate of insurance quoted above, count I alleged that defendant was aware that decedent met the conditions and denied his claim in bad faith. Count n alleged that defendant misrepresented the advantages, benefits, terms, and conditions of the insurance policy in violation of the mcpa.
In its motion for summary disposition, defendant claimed it would not have insured Smith had it been aware of his true medical background. In support of its motion, defendant submitted: (1) a copy of Smith’s application revealing negative responses to the aforementioned health inquiries, (2) medical records establishing Smith had been diagnosed with coronary heart *452disease in 1986 and was being treated for this condition at the time of his death, (3) interrogatory responses establishing Smith was an insulin-dependent diabetic, and (4) an affidavit by a former underwriter who claimed defendant would have denied the certificate of insurance had it been aware of Smith’s condition at the time he applied for coverage.
Opposing the motion, plaintiff submitted an affidavit and claimed: (1) the slash marks through the “NO” responses were not in Smith’s handwriting, and (2) defendant failed to proffer evidence establishing that it had received the insurance application when the insurance policy was issued. Plaintiff also claimed that she was not bound by any statements made in the application and that defendant was precluded from admitting the application into evidence because the application was not attached to plaintiff’s certificate of insurance.
The trial court granted the motion for summary disposition pursuant to MCR 2.116(C)(10). It concluded: (1) an insurer is not obligated to attach the application to the certificate of insurance, (2) Smith had not truthfully answered the application inquiries, and (3) the signature appeared authentic. The trial court noted that there was a question whether Smith authored the slash marks through the “no” boxes on the application. However, the court concluded that the issue was “largely beside the point” because the answers appeared to be “adoptively [Smith’s].”
Addressing the MCPA claims, the trial court concluded that the mcpa does not apply to activity regulated by the State Commissioner of Insurance, citing Kekel v Allstate Ins Co, 144 Mich App 379; 375 NW2d *453455 (1985). Accordingly, the trial court dismissed plaintiffs complaint.
The Court of Appeals reversed. 223 Mich App 264, 266; 565 NW2d 877 (1997). It concluded that there was no genuine issue of material fact regarding the authenticity of Smith’s signature. However, the Court held that a factual question existed regarding whether Smith had authored the slash marks through the “NO” boxes and whether defendant had received and relied on the application when issuing the policy.
Addressing whether defendant was exempt from the alleged violations of the MCPA, the Court of Appeals considered § 4(l)(a) of the act which provides:
This act does not apply to . . . the following:
(a) A transaction or conduct specifically authorized under laws administered by a regulatory board or officer acting under statutory authority of this state or file United States. [MCL 445.904(1); MSA 19.418(4)(1).]
It concluded that a “common-sense reading” of the language reveals that the Legislature did not intend to exempt illegal conduct. Id. at 281, citing Attorney General v Diamond Mortgage Co, 414 Mich 603; 327 NW2d 805 (1982). Concluding that Kekel erroneously interpreted § 4(l)(a), the Court of Appeals held, as a matter of law, that defendant was not entitled to summary disposition. Id. at 282-283.
The Court also concluded that Kekel erroneously interpreted § 4(2) of the MCPA, which reads:
Except for the purposes of an action filed by a person under [MCL 445.911; MSA 19.418(11)], this act does not apply to an unfair, unconscionable, or deceptive method, act, or practice that is made unlawful by:
*454(a) Chapter 20 of the insurance code of 1956, Act No. 218 of the Public Acts of 1956, as amended, being sections 500.2001 to 500.2093 of the Michigan Compiled Laws. [MCL 445.904(2); MSA 19.418(4)(2).]
The Court reasoned that, while § 4(2) (a) generally exempts from the mcpa deceptive acts made unlawful by chapter 20 of the Insurance Code, the first phrase of § 4(2) expressly permits private actions to be brought pursuant to § 11.
n. ANALYSIS
A motion for summary disposition under MCR 2.116(C)(10), which tests the factual support of a claim, is subject to de novo review. Spiek v Dep’t of Transportation, 456 Mich 331, 337; 572 NW2d 201 (1998).
This Court in Quinto v Cross & Peters Co, 451 Mich 358, 362-363; 547 NW2d 314 (1996), set forth the following standards for reviewing motions for summary disposition brought under MCR 2.116(C)(10):
In reviewing a motion for summary disposition brought under MCR 2.116(C)(10), a trial court considers affidavits, pleadings, depositions, admissions, and documentary evidence filed in the action or submitted by the parties, MCR 2.116(G)(5), in the light most favorable to the party opposing the motion. A trial court may grant a motion for summary disposition under MCR 2.116(C)(10) if the affidavits or other documentary evidence show that there is no genuine issue in respect to any material fact, and the moving party is entitled to judgment as a matter of law. MCR 2.116(C)(10), (G)(4).
*455In presenting a motion for summary disposition, the moving party has the initial burden of supporting its position by affidavits, depositions, admissions, or other documentary evidence. Neubacher v Globe Furniture Rentals, 205 Mich App 418, 420; 522 NW2d 335 (1994). The burden then shifts to the opposing party to establish that a genuine issue of disputed fact exists. Id. Where the burden of proof at trial on a dispositive issue rests on a nonmoving party, the non-moving party may not rely on mere allegations or denials in pleadings, but must go beyond the pleadings to set forth specific facts showing that a genuine issue of material fact exists. McCart v J Walter Thompson, 437 Mich 109, 115; 469 NW2d 284 (1991). If the opposing party fails to present documentary evidence establishing the existence of a material factual dispute, the motion is properly granted. McCormic v Auto Club Ins Ass’n, 202 Mich App 233, 237; 507 NW2d 741 (1993).[2]
*456A. BREACH OF CONTRACT
As stated, the Court of Appeals held that two factual issues precluded the trial court’s grant of summary disposition to defendant: (1) whether Smith had authored the slash marks through the “no” boxes on the application, and (2) whether defendant had relied on the application when issuing the policy. We disagree on both points.
First, the Court of Appeals erred in holding that there was a question of material fact regarding whether Smith “made or caused to be made the marks in the box describing the state of his health . . . .” 223 Mich App 275. Defendant submitted a copy of the completed application bearing Smith’s signature immediately below the provision warning that all questions must be answered “honestly and truthfully.” Plaintiff does not dispute that the signature on the insurance application is Smith’s.
In an attempt to rebut defendant’s prima facie showing, plaintiff stated in her affidavit that the slash marks placed through the “yes” and “no” boxes on the application “are not in my father’s handwriting.” Plaintiff essentially suggests that Smith may have signed the application in blank and that someone at the dealership filled in the boxes as shown in the application. This Court in General American Life Ins *457Co v Wojciechowski, 314 Mich 275, 283; 22 NW2d 371 (1946), rejected a similar attempt to avoid an insurer’s claim of misrepresentation voiding an insurance contract:
Appellant claims that there was no showing that [the insured] made the statements found in the application over his signature, that the application might have been signed in blank, and that it might be inferred that the answers had been written in after the application was signed. Defendant offered no proof bearing on this issue and conceded that the signature to the application was that of [the insured]. A copy of the application was attached to the bill of complaint and its authenticity was not denied by the defendant. A prima facie showing was thus made by the [insurer], and the circuit judge correctly concluded that in the absence of any proof to that effect the court would not be justified in finding that a fraud had been perpetrated on either the insurer or the insured, by someone who might have filled in the answers unknown to [the insured].
As in Wojciechowski, plaintiff’s argument here constitutes mere speculation, not a reasonable inference from the evidence, and thus does not rise to the level of creating a genuine issue of material fact for trial. Because plaintiff has offered no proof that someone else answered the health inquiries contained in the application without Smith’s knowledge or direction, plaintiff has failed to create a genuine issue of material fact regarding the application’s authenticity.3
Second, we agree with defendant that the Court of Appeals erred in concluding that, under MCL 500.2218; MSA 24.12218, defendant was required to *458prove that it relied on the misrepresentations contained in Smith’s application for insurance. We review de novo questions involving statutory interpretation. Putkamer v Transamerica Ins Corp of America, 454 Mich 626, 631; 563 NW2d 683 (1997).
MCL 500.2218; MSA 24.12218 limits the right of an insurer to rescind an insurance policy on the basis of false statements made in the insurance application. The statute provides in relevant part:
The falsity of any statement in the application for any disability insurance policy covered by chapter 34 of this code may not bar the right to recovery thereunder unless such false statement materially affected either the acceptance of the risk or the hazard assumed by the insurer. [MCL 500.2218; MSA 24.12218 (emphasis added).]
This Court has not had occasion to address directly whether § 2218 requires an insurer to show that it actually relied upon a false statement made in an insurance application before the insurer may avoid payment under the policy.4 The Court of Appeals imposed such a requirement in Howard v Golden State Mut Life Ins Co, 60 Mich App 469, 477; 231 NW2d 655 (1975). See also United of Omaha Life Ins Co v Rex Roto Corp, 126 F3d 785, 787 (CA 6, 1997); Auto-Owners Ins Co v Comm’r of Ins, 141 Mich App 776, 781, n 3; 369 NW2d 896 (1985). However, it is *459clear that the Howard Court never considered the precise language used in the statute.5
As an initial matter, we find it significant that § 2218 does not expressly mention reliance. Moreover, while the insurer, under § 2218, necessarily must have relied on a false statement in an insurance application in order for such a statement to have materially affected the insurer’s “acceptance of the risk,” the statute also permits the insurer to rescind the policy if the false statement materially affected the “hazard assumed” by the insurer. In In re Certified Question, Wickersham v John Hancock Mut Life Ins Co, 413 Mich 57, 63; 318 NW2d 456 (1982), we recognized that the Legislature’s use of “either” and “or” indicates that the terms “acceptance of the risk” and “hazard assumed” have different meanings. We must give effect to both terms in order to avoid rendering either term mere surplusage. Smith v Employment Security Comm, 410 Mich 231, 250; 301 NW2d 285 (1981).
As we explained in Wickersham, supra at 63:
Acceptance of the risk refers to the time of making of the contract of insurance and to the insurance concept of risk. Whether an insurer determines to enter into a contract is affected by its assessment of the likelihood of a fact increasing the chances of the loss insured against.
*460On the other hand, the term “hazard assumed” refers to the circumstances of the loss. Id. at 62. In order for a misstatement to be material to the hazard assumed, the misstatement “ ‘must be shown in some way to have affected [the hazard] or contributed to the loss ....’” Id. at 62, quoting Prudential Ins Co of America v Saxe, 77 US App DC 144, 156; 134 F2d 16 (1943). Thus, in Wickersham, supra at 63, we observed that the insured’s undisclosed heart problems did not affect or contribute to the hazard assumed because the insured died in a swimming accident.6
Accordingly, while a misrepresentation in an insurance application clearly cannot affect an insurer’s *461“acceptance of the risk” unless the insurer relied on the misrepresentation in issuing the policy, we conclude that such a misrepresentation materially affects the “hazard assumed” by an insurer whenever the facts misrepresented are causally connected to the loss. When such a causal relationship exists, an insurer is entitled to rescind the policy under § 2218 even without a showing of reliance.7
In this case, Smith misrepresented his health, stating that he did not have a heart condition. In fact, Smith died of a heart attack. Under these circumstances, it is beyond question that Smith’s misrepresentation is causally connected to the loss. The misrepresentation materially affected the hazard assumed, Smith’s death, regardless of whether *462defendant actually relied on that misrepresentation. Therefore, under § 2218, defendant was not required to establish reliance in order to avoid payment under the policy.
Accordingly, we reverse the Court of Appeals decision on the breach of contract claim and reinstate the trial court’s order granting summary disposition to defendant.
B. MICHIGAN CONSUMER PROTECTION ACT
Turning to the issue whether defendant is exempted from plaintiff’s claim of MCPA violations, we first examine whether defendant is exempted by § 4(l)(a). The language of § 4(l)(a) provides that the MCPA is inapplicable to a “transaction or conduct specifically authorized under laws administered by a regulatory board or officer acting under statutory authority of this state . . . .” MCL 445.904(1); MSA 19.418(4)(1). Defendant asserts that its application and certificate of insurance forms were submitted to8 and implicitly approved by9 the State Commissioner *463of Insurance. Hence, it contends, the immediate transaction, the sale of credit life insurance, was “specifically authorized” and, therefore, was exempted under § 4(a)(1).10 Plaintiff, however, essentially responds that the statute does not specifically authorize the fraudulent insurance practices that she claims were committed in this case.
As the Court of Appeals recognized, our decision in Diamond Mortgage11 controls the resolution of this issue. In Diamond Mortgage, the defendant, a real estate broker, also advertised and offered loans to homeowners at an eleven percent interest rate. The financing arrangement resulted in the defendant receiving a “brokerage or prepaid finance fee” that the Attorney General alleged was actually an interest charge and, moreover, usurious. Id. at 607. The Attorney General also claimed that the defendant used confusing and inconsistent forms and that its method of doing business violated the mcpa. Id.
The defendant in Diamond Mortgage argued that it was exempt from the mcpa under § 4(l)(a) because it had a real estate broker’s license and that one of the activities contemplated was that a licensee would negotiate the mortgage of real estate. Id. at 616. Like plaintiff here, the defendants in Diamond Mortgage responded that “no statute [or regulatory agency] specifically authorize[d] misrepresentations or false promises” made in conducting that activity. Id. at 617.
*464In concluding that the defendants were not exempt from the MCPA, this Court reasoned:
While the license generally authorizes Diamond to engage in the activities of a real estate broker, it does not specifically authorize the conduct that plaintiff alleges is violative of the Michigan Consumer Protection Act, nor transactions that result from that conduct. In so concluding, we disagree that the exemption of § 4(1) becomes meaningless. While defendants are correct in stating that no statute or regulatory agency specifically authorizes misrepresentations or false promises, the exemption will nevertheless apply where a party seeks to attach such labels to “[a] transaction or conduct specifically authorized under laws administered by a regulatory board or officer acting under statutory authority of this state or the United States.” For this case, we need only decide that a real estate broker’s license is not specific authority for all the conduct and transactions of the licensee’s business. [Id. at 617.]
In short, Diamond Mortgage instructs that the focus is on whether the transaction at issue, not the alleged misconduct, is “specifically authorized.” Thus, the defendant in Diamond Mortgage was not exempt from the MCPA because the transaction at issue, mortgage writing, was not “specifically authorized” under the defendant’s real estate broker’s license.
Applying this analysis in Kekel, the Court of Appeals concluded that the defendant insurer in that case was exempted from the plaintiff’s alleged violations of the MCPA pursuant to MCL 445.903; MSA 19.418(3). It explained:
Diamond is distinguishable from the case at bar. The activities of the defendant in Diamond which the plaintiffs there were complaining of were not subject to any regulation under the real estate broker’s license of the defendant and thus such conduct was not reviewable by the applica*465ble licensing or regulatory authority. . . . The insurance industry is under the authority of the State Commissioner of Insurance and subject to the extensive statutory and regulatory scheme, all administered “by a regulatory board or officer acting under statutory authority of this state.” [Id. at 384, citing MCL 445.904(l)(a); MSA 19.418(4)(l)(a).]
Consistent with these rulings, we conclude here that, when the Legislature said that transactions or conduct “specifically authorized” by law are exempt from the MCPA, it intended to include conduct the legality of which is in dispute. Contrary to the “common-sense reading” of this provision by the Court of Appeals, we conclude that the relevant inquiry is not whether the specific misconduct alleged by the plaintiffs is “specifically authorized.” Rather, it is whether the general transaction is specifically authorized by law, regardless of whether the specific misconduct alleged is prohibited. Therefore, we conclude that § 4(l)(a) generally exempts the sale of credit life insurance from the provisions of the mcpa, because such “transaction or conduct” is “specifically authorized under laws administered by a regulatory board or officer acting under statutory authority of this state or the United States.”12 As a consequence, we *466reverse the judgment of the Court of Appeals, in part, on this issue.
However, we agree with the Court of Appeals that the Kekel Court misconstrued § 4(2) of the MCPA. In addition to the broad exemption provided in § 4(l)(a), § 4(2) provides in relevant part:
Except for the purposes of an action filed by a person under [MCL 445.911; MSA 19.418(11)], this act does not apply to an unfair, unconscionable, or deceptive method, act, or practice that is made unlawful by:
(a) Chapter 20 of the insurance code of 1956, Act No. 218 of the Public Acts of 1956, as amended, being sections 500.2001 to 500.2093 of the Michigan Compiled Laws. [MCL 445.904(2); MSA 19.418(4)(2).]
Thus, § 4(2) (a) specifically exempts from the mcpa unfair, unconscionable, or deceptive methods, acts, or practices made unlawful by chapter 20 of the Insurance Code.13 Yet, the first phrase of § 4(2) explicitly provides that the exemption is inapplicable to actions filed under § 11 of the mcpa, which provides in relevant part:
(1) Whether or not he seeks damages or has an adequate remedy at law, a person may bring an action to do either or both of the following:
(a) Obtain a declaratory judgment that a method, act, or practice is unlawful under section 3.
*467(b) Enjoin in accordance with the principles of equity a person who is engaging or is about to engage in a method, act, or practice which is unlawful under section 3.
(2) Except in a class action, a person who suffers loss as a result of a violation of this act may bring an action to recover actual damages or $250.00, whichever is greater, together with reasonable attorneys’ fees. [MCL 445.911; MSA 19.418(11).]
Giving effect to both § 4(1) and § 4(2), we conclude that private actions are permitted against an insurer pursuant to § 11 of the mcpa regardless of whether the insurer’s activities are “specifically authorized.” Although § 4(l)(a) generally provides that transactions or conduct “specifically authorized” are exempt from the provisions of the MCPA, § 4(2) provides an exception to that exemption by permitting private actions pursuant to § 11 arising out of misconduct made unlawful by chapter 20 of the Insurance Code. Therefore, the exemptions provided by §§ 4(l)(a) and 4(2)(a) are inapplicable to plaintiff’s mcpa claims to the extent that they involve allegations of misconduct made unlawful under chapter 20 of the Insurance Code.
For these reasons, we conclude that defendant is not entitled to summary disposition with regard to plaintiff’s mcpa claims. To the extent that Kekel and its progeny14 are inconsistent with this holding, they are overruled.
m. conclusion
We reverse the Court of Appeals decision on the breach of contract claim. There is no genuine issue of *468material fact regarding the authenticity of the insurance application. Moreover, under the circumstances of this case, defendant was not required to establish that it relied on Smith’s misrepresentation when issuing the policy. Therefore, the trial court’s grant of summary disposition for defendant on the breach of contract claim is reinstated.
We affirm the Court of Appeals in part and reverse in part with regard to the alleged violations of the MCPA. Contrary to the Court of Appeals conclusion, § 4(l)(a) exempts the sale of insurance from the provisions of the mcpa. However, we agree with the Court of Appeals that § 4(2) provides an exception to that exemption by permitting private actions pursuant to § 11. Therefore, defendant is not entitled to summary disposition of plaintiff’s mcpa claims. This case is remanded to the trial court for further proceedings.
Weaver, C.J., and Brickley, Taylor, and Corrigan, JJ., concurred with Young, J.MCL 445.903(l)(g), (n), (s), (bb), (cc); MSA 19.418(3)(l)(g), (n), (s), (bb), (cc).
We take this occasion to note that a number of recent decisions from this Court and the Court of Appeals have, in reviewing motions for summary disposition brought under MCR 2.116(C)(10), erroneously applied standards derived from Rizzo v Kretschmer, 389 Mich 363; 207 NW2d 316 (1973). These decisions have variously stated that a court must determine whether a record “might be developed” that will leave open an issue upon which reasonable minds may differ, see, e.g., Farm Bureau Mut Ins Co of Michigan v Stark, 437 Mich 175, 184; 468 NW2d 498 (1991); First Security Savings Bank v Aitken, 226 Mich App 291, 304; 573 NW2d 307 (1997); Osman v Summer Green Lawn Care, Inc, 209 Mich App 703, 706; 532 NW2d 186 (1995), and that summary disposition under MCR 2.116(C)(10) is appropriate only when the court is satisfied that “it is impossible for the nonmoving party to support his claim at trial because of a deficiency that cannot be overcome.” Paul v Lee, 455 Mich 204, 210; 568 NW2d 510 (1997); Horton v Verhelle, 231 Mich App 667, 672; 588 NW2d 144 (1998).
These Psizzo-based standards are reflective of the summary judgment standard under the former General Court Rules of 1963, not MCR 2.116(C)(10). See McCart, supra at 115, n 4. Under MCR 2.116, it is no longer sufficient for plaintiffs to promise to offer factual support for their claims at trial. As stated, a party faced with a motion for summary disposition brought under MCR 2.116(C)(10) is, in responding to the motion, *456required to present evidentiary proofs creating a genuine issue of material fact for trial. Otherwise, summary disposition is properly granted. MCR 2.116(G)(4).
Consequently, those prior decisions of this Court and the Court of Appeals that approve of Rte«o-based standards for reviewing motions for summary disposition brought under MCR 2.116(C)(10) are overruled to the extent that they do so.
Because plaintiff failed to rebut defendant’s prima facie showing, the Court of Appeals erred in holding that defendant was required to submit additional evidence.
Some of our past decisions arguably have implied such a requirement. See, e.g., Manufacturers Life Ins Co v Beardsley, 365 Mich 308, 311; 112 NW2d 514 (1961); Prudential Ins Co of America v Ashe, 266 Mich 667, 671-672; 254 NW 243 (1934); Nat’l Life & Accident Ins Co v Nagel, 260 Mich 635, 638; 245 NW 540 (1932).
Justice Kelly’s dissent, post at 472, finds the Howard decision to be persuasive in interpreting the statute because the Howard Court adopted a reliance requirement “immediately after quoting § 2218.” However, we believe it clear that the “test” that was “formulated” by the Court of Appeals in Howard was not based upon the language of the statute, but drawn from a law review article “and cases therein footnoted.” Howard, supra at 477.
Justice Kelly’s dissent, post at 470-471, claims that we have avoided what clearly is Wickersham,'s discussion of the meaning of § 2218’s materiality requirement. See MCL 500.2218(1); MSA 24.12218(1) (“No misrepresentation shall be deemed material unless knowledge by the insurer of the facts misrepresented would have led to a refusal by the insurer to make the contract”). That argument highlights the dissent’s fundamental misunderstanding of § 2218. On its face, the statute’s materiality provision plainly requires that the insurer demonstrate, in hindsight, that it “would have” refused to issue the policy if it had known the facts misrepresented. Such a post hoc determination simply has nothing to do with whether the insurer in fact relied on the misrepresentation when issuing the policy. Thus, the Wickersham Court’s “analysis” to which the dissent refers is wholly inapposite.
The dissent, post at 471, further argues that § 2218(2) “expressly requires an insurer to establish that the prospective insured misrepresented a fact that induced the insurer to contract ....'' Thus, claims the dissent, “an express reference to reliance would be surplusage.” Id. The statute clearly does not state that the misrepresentation must have induced the insurer to contract. Rather, it simply defines a representation as one that is made “as an inducement to the making” of a contract.
While that distinction obviously eludes the dissent, we believe it to be an important one. Clearly, an applicant may make a misrepresentation “as an inducement to the making" of a contract without the inducement actually causing the insurer to contract. Our construction, contrary to the dissent’s, gives meaning to the Legislature’s use of “either” and “or,” which use, as stated, indicates that the terms “acceptance of the risk” and “hazard assumed” have different meanings.
Justice Kelly’s dissent, post at 472, claims that we have cited Wicker-sham “for the proposition that a misrepresentation affecting the hazard assumed by the insurer, as distinguished from the risk accepted, does not require reliance.” The dissent further accuses us of “omitting portions of Wickersham, and misconstruing the remainder . . . .” Post at 474.
We do not suggest that Wickersham in any way addressed the reliance issue presented here. We simply find instructive to our interpretation of § 2218 the fact that the Wickersham Court, albeit in another context, recognized and gave effect to the conceptual difference between “acceptance of the risk” and “hazard assumed.” Interestingly, the dissent does not offer its own construction of these key statutory phrases. We similarly reject the dissent’s determined effort, post at 474, to make dicta in Wickersham a holding by observing that the Wickersham Court’s passing mention of reliance was a “pointed reference.” Whether the Wickersham Court’s reference to reliance was “pointed” or otherwise, it is clear that the reference is dicta. Clearly, reliance was not the issue Wickersham decided, and its fleeting mention of reliance did not constitute a considered analysis of the statutory terms at issue here.
Justice Kelly’s dissent, post at 473, n 7, also accuses us of ignoring the meaning of the word “affect” “by failing to explain how a misrepresentation, which may never have been received by the insurer, affected the hazard assumed.” As explained in the text, because the phrase “hazard assumed” refers to the circumstances of the loss rather than the time of making of the contract, a misrepresentation that is causally connected to the loss “affects” the “hazard assumed” regardless of whether the insurer actually relied on the misrepresentation in issuing the policy.
MCL 550.612; MSA 24.568(12) provides:
All policies, certificates of insurance, notices of proposed insurance, applications for insurance, binder, endorsements and riders shall be filed with the commissioner of the state in which the policy is issued.
MCL 550.613; MSA 24.568(13) provides:
The commissioner within 30 days after the filing of all policies, certificates of insurance, notices of proposed insurance, applications for insurance, binders, endorsements and riders, in addition to other requirements of law, may disapprove any such form if the benefits provided therein are not reasonable in relation to the premium charge or if it contains provisions which are unjust, unfair, inequitable, misleading, deceptive or encourage misrepresentation of such policy.
See also the Credit Insurance Act, MCL 550.601 et seq.; MSA 24.568(1) et seq. Section 2 of the act provides, in relevant part: “All life insurance and all accident and health insurance sold in connection with loans or other credit transactions shall be subject to the provisions of this act . . . .”
Supra at 617.
Citing Temborius v Slatkin, 157 Mich App 587; 403 NW2d 821 (1986), Justice Cavanagh’s concurrence, post at 480, argues that, “under the majority’s interpretation of ‘transaction or conduct,’ the defendant’s conduct [in Temborius] would be exempt [from the mcpa] under subsection 4(l)(a) because the sale of automobiles is specifically authorized by the Secretary of State . . . .” The concurrence, post at 480-481, further invites us to “provide meaningful examples where a consumer would not be blocked by subsection 4(l)(a) . . . .”
We need not reach or otherwise address consumer transactions that are not before us because it is clear in this case that the sale of credit life insurance is “specifically authorized” under the Credit Insurance Act, which is administered by the insurance commissioner. See MCL 550.601 et seq.; MSA 24.568(1) ei seq.; see also MCL 500.402; MSA 24.1402 (“No per*466son shall act as an insurer and no insurer shall issue any policy or otherwise transact insurance in this state except as authorized by a subsisting certificate of authority granted to it by the commissioner pursuant to this code”); MCL 500.200; MSA 24.1200 (“There is hereby established a separate and distinct state department which shall be especially charged with the execution of the laws in relation to insurance”). Thus, it is clear that, contrary to the position of the concurrence, post at 480, insurance companies are not “[l]ike most businesses.”
See, generally, MCL 500.2001 et seq.\ MSA 24.12001 et seq.
See Bell v League Life Ins Co, 149 Mich App 481; 387 NW2d 154 (1986).