Texas Laws and Rules Pertinent to Insurance
Exam 2026 | All Questions and Correct
Answers | Graded A+ | Verified Answers
Which of the following groups may NOT be insured by a group life insurance
policy?
- Employees
- Supervisors
- Administrators
- Individuals who are related by blood ---------CORRECT ANSWER-----------------
Individuals who are related by blood
An insurance company organized under New York laws and licensed to do
business in TX is considered a(n):
- reciprocal company
- foreign company
- alien company
- export company ---------CORRECT ANSWER-----------------foreign company
Who is liable when an insured suffers a loss on a policy sold by an agent through
an insurer not authorized to conduct business in Texas?
- insured
- agent and insured
,- agent
- commissioner of insurance ---------CORRECT ANSWER-----------------the agent
What is the monetary penalty for willfully violating a cease-and-desist order?
- a fine of up to $500
- a fine of up to $250
- a fine of up to $50
- a fine of up to $100 ---------CORRECT ANSWER-----------------A fine of up to $500
As a condition for a loan, a bank requires the borrower to purchase credit
insurance from a specific company. What is the bank guilty of?
- coercion
- defamation
- rebating
- misrepresentation ---------CORRECT ANSWER-----------------Coercion
To terminate an agent's appointment, an insurance company must:
- send termination notice to the TX department of insurance
- send termination notice to governor
- pay a termination fee
, - request a hearing before the commissioner of insurance ---------CORRECT
ANSWER-----------------send termination notice to the Texas Department of
Insurance
During a sales presentation for a participating life insurance policy, an agent
MUST:
- make a prospect understand that dividends are NOT guaranteed
- make a prospect understand that dividends ARE guaranteed
- offer to the prospect a minimum return of investment
- offer to the prospect a portion of the commissions ---------CORRECT ANSWER-----
------------make a prospect understand that dividends are NOT guaranteed
An insured may assign up to ___ of policy ownership under an individual life
insurance policy.
- 25%
- 50%
- 75%
- 100% ---------CORRECT ANSWER-----------------100%
Why would the Insurance Commissioner examine the records of an insurance
company?
- to determine the solvency of the company
- to set insurance rates for the company
Exam 2026 | All Questions and Correct
Answers | Graded A+ | Verified Answers
Which of the following groups may NOT be insured by a group life insurance
policy?
- Employees
- Supervisors
- Administrators
- Individuals who are related by blood ---------CORRECT ANSWER-----------------
Individuals who are related by blood
An insurance company organized under New York laws and licensed to do
business in TX is considered a(n):
- reciprocal company
- foreign company
- alien company
- export company ---------CORRECT ANSWER-----------------foreign company
Who is liable when an insured suffers a loss on a policy sold by an agent through
an insurer not authorized to conduct business in Texas?
- insured
- agent and insured
,- agent
- commissioner of insurance ---------CORRECT ANSWER-----------------the agent
What is the monetary penalty for willfully violating a cease-and-desist order?
- a fine of up to $500
- a fine of up to $250
- a fine of up to $50
- a fine of up to $100 ---------CORRECT ANSWER-----------------A fine of up to $500
As a condition for a loan, a bank requires the borrower to purchase credit
insurance from a specific company. What is the bank guilty of?
- coercion
- defamation
- rebating
- misrepresentation ---------CORRECT ANSWER-----------------Coercion
To terminate an agent's appointment, an insurance company must:
- send termination notice to the TX department of insurance
- send termination notice to governor
- pay a termination fee
, - request a hearing before the commissioner of insurance ---------CORRECT
ANSWER-----------------send termination notice to the Texas Department of
Insurance
During a sales presentation for a participating life insurance policy, an agent
MUST:
- make a prospect understand that dividends are NOT guaranteed
- make a prospect understand that dividends ARE guaranteed
- offer to the prospect a minimum return of investment
- offer to the prospect a portion of the commissions ---------CORRECT ANSWER-----
------------make a prospect understand that dividends are NOT guaranteed
An insured may assign up to ___ of policy ownership under an individual life
insurance policy.
- 25%
- 50%
- 75%
- 100% ---------CORRECT ANSWER-----------------100%
Why would the Insurance Commissioner examine the records of an insurance
company?
- to determine the solvency of the company
- to set insurance rates for the company
