Texas Statutes and Rules Pertinent to Life Insurance Only — Texas exam
12.5% of the scored questions — about 10 of 80. This section is Texas law, the part national study material covers least.
1 / 8
A delivered Texas life policy says the buyer has only five days to examine the policy. What is the compliance problem?
Answer and explanation
Answer: B. TDI states that Texas life policies have a free-look period of at least 10 to 20 days, during which the policy may be canceled for any reason for a full refund.Source: Texas Department of Insurance — Life Insurance Guide — Shopping for life insurance > Use your free-look period
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A Texas group life plan includes an accelerated benefit. Who receives the accelerated payment?
Answer and explanation
Answer: B. An accelerated benefit is a living benefit. It is paid to the covered person or certificate holder on proof of the qualifying condition and reduces the group death benefit later payable.Source: Texas Insurance Code — Tex. Ins. Code ch. 1131, accelerated benefits under group life coverage
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A Texas group life plan offers dependent coverage on an employee's spouse and children. Who is ordinarily the beneficiary of the dependent's benefit?
Answer and explanation
Answer: B. Dependent group life is written for the employee's benefit. The employee is the certificate holder and normally the beneficiary of coverage on a spouse or child.Source: Texas Insurance Code — Tex. Ins. Code ch. 1131, dependent coverage under group life policies
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A Texas individual life policy has been in force for more than two years during the insured’s lifetime, and its incontestability period has expired. May the insurer rely on a contractual fraud exception to reopen a contest about the original application?
Answer and explanation
Answer: C. Section 1101.006 makes the policy incontestable after the stated period except for nonpayment of premiums and permits an optional wartime naval or military-service exception. It does not authorize a general fraud exception extending the original application’s contestable period. A contest concerning a separate reinstatement is a different issue.Source: Texas Insurance Code — §1101.006; 28 TAC §4.604
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A Texas insured dies with an outstanding policy loan and accrued loan interest. How is the death benefit settled?
Answer and explanation
Answer: B. A policy loan is a lien against the policy. At death the insurer deducts the loan balance and accrued interest from the proceeds and pays the remainder to the beneficiary.Source: Texas Insurance Code — Tex. Ins. Code ch. 1101, effect of policy indebtedness on proceeds
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A Texas insured innocently gives a slightly inaccurate date for a past medical consultation that would not have changed underwriting. May the insurer void the policy?
Answer and explanation
Answer: C. Materiality is the test. An error that would not have changed the underwriting decision does not support rescission, and after two years the incontestability clause bars the contest entirely absent fraud.Source: Texas Insurance Code — Tex. Ins. Code ch. 1101, representations and incontestability
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A Texas life policy contains a provision that is less favourable to the insured than the Insurance Code requires. What is the effect?
Answer and explanation
Answer: B. Statutory required provisions set a floor. An insurer may offer terms more favourable than the statute, but a provision falling below the statutory standard does not bind the insured.Source: Texas Insurance Code — Tex. Ins. Code ch. 1101, effect of provisions inconsistent with the Code
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A Texas life policy sets a period within which suit must be brought on a claim. What does the Insurance Code require of that period?
Answer and explanation
Answer: C. Texas permits a contractual limitation on suits but sets a statutory floor. A provision purporting to shorten the time below that floor is unenforceable against the claimant.Source: Texas Insurance Code — Tex. Ins. Code ch. 1101, limitation of actions on the policy
All 73 texas statutes and rules pertinent to life insurance only questions
- A Texas ordinary whole life policy reaches its stated maturity date and the insured is still alive. What does the insurer do?
- A Texas owner pays an annual premium and the insured dies four months into that policy year. What happens to the unearned premium?
- A Texas owner's policy loan plus accrued interest grows until it equals the policy's cash value. What happens?
- A Texas policy states that no suit may be brought more than six months after a claim is denied. How is that clause treated?
- A Texas whole life policy has accumulated cash value and the owner requests a policy loan. What is the insurer's obligation?
- An insured has a life insurance policy with a $100,000 death benefit. To secure a bank loan, the insured executes a collateral assignment. If the insured dies when the outstanding loan balance is $30,000, how will the death benefit be distributed?
- An insurer wants to contest a Texas policy using a statement the applicant made on the application, but no copy of the application was attached to the policy. What is the result?
- Does the 2-year incontestability clause under TIC § 1101.006 apply to disability provisions or accidental death riders attached to a life policy?
- For a replacement transaction subject to Texas Insurance Code §1114.053(e), what return-right notice must the replacing insurer provide to the policy or contract owner?
- For an ordinary employer group life policy subject to §1131.108, what document must the insurer issue to the policyholder for delivery to each insured?
- How does accelerating a Texas group life benefit affect the employee's conversion right if employment later ends?
- How does settlement at maturity differ from settlement on death for a Texas life policy?
- How does Texas law characterise statements made by an insured in a life insurance application?
- How is the maximum benefit amount of a credit life insurance policy constrained under Texas law?
- If an applicant misstates their age as 30 instead of 40 on a life application, and dies 5 years later, how is the claim settled under TIC § 1101.007?
- If an applicant misstates their sex on a life application, resulting in paying lower premiums, how does the insurer settle a death claim under TIC § 1101.007?
- If an employee converts group life insurance to individual coverage under TIC § 1131.108, how is the premium rate for the individual policy calculated?
- If an insured dies during the 31-day grace period BEFORE paying the overdue premium, what payout rule applies under TIC § 1101.005?
- If an insured misstates their age on a Texas life insurance application, what statutory adjustment must the insurer make upon death under TIC § 1101.007?
- May a certificate holder under a Texas group life policy assign the incidents of ownership in the coverage?
- Under 28 TAC § 21.103 (Texas Insurance Advertising Rules), who bears ultimate legal responsibility for all advertisements generated or used by an insurance producer?
- Under 28 TAC § 3.1004, what specific written list must a replacing life insurance agent leave with the applicant at the time of application?
- Under 28 TAC § 3.1006, if a policyowner exercises their 30-day free look cancellation right on a replacement policy, what amount must the replacing insurer refund?
- Under 28 TAC Chapter 3 (Subchapter A, Replacement Rules), what transaction constitutes a life insurance replacement?
- Under Texas advertising regulations, if a spokesperson receives compensation for endorsing an insurance product, what requirement must be satisfied?
- Under Texas Estates Code § 122.001, what happens if a primary beneficiary is convicted of willfully causing the death of the insured (slayer rule)?
- Under Texas Family Code § 9.301, what happens to a former spouse's designation as beneficiary on a life insurance policy upon divorce?
- Under Texas Insurance Code § 1101.006, after a life insurance policy has been in force during the lifetime of the insured for 2 years from issuance, on what grounds can the insurer contest policy validity?
- Under Texas Insurance Code § 1103.003, who possesses the legal right to designate or change beneficiaries on a life policy unless an irrevocable beneficiary is named?
- Under Texas Insurance Code § 1103.055, how does an absolute assignment of a life insurance policy affect beneficiary rights?
- Under Texas Insurance Code § 1103.102, within how many days after receiving proof of death must an insurer pay a life insurance death claim to avoid statutory interest penalties?
- Under Texas Insurance Code Chapter 425 (Subchapter B), what is the primary statutory purpose of establishing legal reserve requirements for life insurers?
- Under Texas law, why does it matter that an insured's application statements are representations rather than warranties?
- Under Texas law, why does the advance payment principle make the grace period necessary?
- Under Texas Replacement regulations (28 TAC § 3.1003), how is a transaction treated if a policyowner exercises a contractual right to convert a term policy to a whole life policy with the same insurer?
- Under Texas Replacement regulations, what recordkeeping duty is imposed on a replacing insurer regarding the replacement notices provided by its agents?
- Under the Texas entire contract requirement, what makes up the agreement between the insurer and the policyowner?
- Under TIC § 1101.005, if a premium is not paid by the due date, how long does policy coverage remain in force during the grace period?
- Under TIC § 1101.005, what statutory minimum grace period must be provided for premium payments on individual life policies in Texas?
- Under TIC § 1101.009, can an insurer charge interest on back premiums when an insured reinstates a lapsed life policy?
- Under TIC § 1101.009, what maximum timeframe is allowed for an insured to reinstate a lapsed life policy by paying back premiums plus interest and providing proof of insurability?
- Under TIC § 1103.104, from what date is interest calculated if a life insurer delays death benefit payment past 60 days?
- Under TIC § 1131.051, what condition applies to employer-sponsored group life insurance coverage for retired employees?
- Under TIC § 1131.051, what restriction applies to dependent group life insurance coverage issued to cover an employee's spouse or children?
- Under TIC § 1131.051, what restriction applies to employer group life policies regarding individual selection of insurance amounts?
- Under TIC § 1131.053, what requirement applies to creditor group life insurance issued to cover debtors?
- Under TIC § 1131.055, can a credit union issue group life insurance covering its members?
- Under TIC § 1131.056, can a labor union or trade association establish a group life insurance plan for its members?
- What condition must an insured fulfill to reinstate a lapsed life policy under TIC § 1101.009 besides paying back premiums with interest?
- What disclosure does Texas require when accelerated benefits are offered on a life policy?
- What does an accelerated death benefit provision let a Texas policyowner do?
- What does it mean that life insurance premiums in Texas are payable in advance?
- What is a collateral assignment of a life insurance policy under Texas law?
- What is the primary purpose of credit life insurance?
- What key cost comparison index numbers are included in a Texas life insurance Policy Summary to help buyers evaluate relative policy costs?
- What mandatory extended free look cancellation window must be provided to a Texas policyholder on a replacement life insurance policy under 28 TAC § 3.1006?
- What requirement applies to a life insurance producer if an applicant indicates that replacement is NOT involved in the application under 28 TAC § 3.1004?
- What restriction applies to suicide clause exclusions in Texas individual life policies under TIC § 1101.055?
- Which document provides generic information explaining life insurance types, coverage choices, and cost comparison methods to consumers?
- Which mortality table standard is prescribed under TIC Chapter 425 for calculating minimum legal reserves for Texas individual life policies?
- Which provision may NOT be included in a Texas individual life insurance policy?
- Which transaction is EXEMPT from Texas replacement regulations under 28 TAC § 3.1003?
- Who at an insurer may agree to change the terms of an issued Texas life policy?
- Why does Texas set a minimum on any contractual limitation period for suing on a life policy?
- Within how many business days must a replacing life insurer notify the existing life insurer of a proposed replacement under 28 TAC § 3.1005?
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