Texas Statutes and Rules Common to Life and Health Insurance
A Texas agency keeps client premium in a properly designated trust account but uses part of it to cover payroll during a slow month, replacing it later. How is this viewed?
Answer and explanation
Answer: D. Using fiduciary money for the agency's own purposes is conversion. Later restoration may affect the sanction but does not cure the violation.Source: Texas Insurance Code — Tex. Ins. Code ch. 4005, misappropriation or conversion as grounds for discipline
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