Free Texas Life & Health Exam Flashcards

The state agency that regulates Texas insurance activity. TDI licenses producers, reviews forms and rates, investigates complaints, examines insurers, and enforces the Texas Insurance Code.

The head of TDI. In Texas, the Commissioner is appointed by the Governor with Senate confirmation, rather than elected by voters.

The Texas license authority for broad life, annuity, accident, health, and HMO products. It is different from a Limited Lines license, which only permits narrow product categories.

For the standard resident life and health license path, Texas does not require mandatory pre-license classroom or online hours before the exam. Study is still strongly recommended.

A license gives legal authority, but an insurer appointment connects the producer to a specific company. The insurer files the appointment and is responsible for the producer's conduct for that company.

After passing the Texas licensing exam, a resident applicant must apply for the license within one year. Missing that window means the exam must be taken again.

Most Texas resident applicants must complete fingerprinting as part of the license application process. Passing the exam alone does not issue the license.

Texas insurance licenses renew every two years. Producers must complete 24 hours of continuing education during the renewal period, including required ethics content.

A Texas producer must keep TDI updated when contact information changes. Current records matter because TDI uses them for regulatory notices and license communications.

A Texas temporary general lines license is separate from the normal exam path. It is one-time, requires an appointing sponsor, requires supervised training, and cannot be renewed.

Texas individual life policies must give the buyer time after delivery to review the policy and return it for a refund if it is not wanted.

After the Texas life policy's contestable period ends, the insurer generally cannot void the policy based on application misstatements, except for limited issues such as nonpayment.

Texas life policies may limit the death benefit if the insured dies by suicide during the policy's initial exclusion period. After that period, the policy pays according to its terms.

A Texas life policy must keep coverage in force during the required grace period after a premium is due. If death occurs during that period, unpaid premium can be deducted from proceeds.

Texas requires an insurable interest when life insurance is applied for. The rule prevents policies from being used as wagers on a stranger's life.

A replacement occurs when new life insurance or an annuity is bought and existing coverage will be lapsed, surrendered, reduced, or otherwise changed.

When replacing life insurance or an annuity, the producer must give the applicant a written notice and document that the applicant understands the possible effects of replacing existing coverage.

In a Texas replacement, the replacing insurer must notify the existing insurer promptly so the current insurer knows its policy may be replaced and can protect the policyholder's rights.

Using misleading or incomplete comparisons to induce a policyholder to lapse, surrender, or replace coverage. Texas treats twisting as an unfair trade practice.

Excessive replacement or changes to policies mainly to generate commissions rather than benefit the customer. It is especially risky when a client loses guarantees, restarts charges, or creates new contestability.

A producer recommending an annuity must put the consumer's interest ahead of the producer's financial interest and base the recommendation on documented consumer information.

Before recommending an annuity, the producer should consider facts such as financial situation, insurance needs, objectives, tax status, risk tolerance, liquidity needs, and time horizon.

Texas annuity sales require delivery of a Buyer's Guide before or at application, so the consumer can compare annuity features, risks, fees, and guarantees before buying.

A Texas annuity recommendation must clearly explain surrender charges, fees, limitations, and penalty-free withdrawal provisions before the consumer commits to the contract.

Texas gives heightened scrutiny to annuity sales involving older consumers. Long surrender periods, liquidity restrictions, and replacement of existing coverage must be carefully justified and documented.

Texas individual health insurance policies must give the buyer a review period after delivery. During that period, the policy can be returned under the policy's free-look rules.

Texas health policies include a grace period for premium payment. Coverage is not immediately lost just because a renewal premium is late.

Texas health insurance law requires certain benefits and consumer protections, such as specified preventive or condition-related coverage, depending on the type of plan.

Small group health rules are designed to protect eligible employer groups from denial based on health status and to require fair renewal unless a valid exception applies.

Texas uses the federally facilitated marketplace, HealthCare.gov, rather than a separate state-based exchange for individual marketplace coverage.

Texas Medicare Supplement policies follow federal Medigap standardization, so plan letters identify benefit packages and make comparisons easier for Medicare beneficiaries.

Texas Medigap rules include an open enrollment period tied to being age 65 and enrolled in Medicare Part B. During that period, guaranteed issue protections apply.

Texas producers may not sell unnecessary or duplicative Medicare-related coverage. The producer must understand what the consumer already has before recommending a policy.

Qualified long-term care policies can provide Medicaid asset-protection benefits through the Texas Long-Term Care Partnership Program when policy requirements are met.

A producer who sells long-term care insurance in Texas must complete LTC-specific training. This is a product-specific requirement beyond holding the general license.

A false or misleading statement about policy benefits, terms, dividends, financial condition, or competing coverage. Texas prohibits misrepresentation in both sales and claims activity.

Offering part of a premium, commission, gift, or other value as an inducement to buy insurance when not allowed by law. Texas treats improper rebating as an unfair practice.

Adding coverage or another product without the customer's informed consent, or implying an optional item is required. The problem is that the buyer did not knowingly choose the extra cost.

A Texas producer who receives client premium funds holds them in a fiduciary capacity. The funds must be handled honestly, kept separate from personal funds, and remitted promptly.

Texas producers must maintain records long enough to document transactions, disclosures, premium handling, and compliance if TDI later reviews a sale or complaint.

The Texas Life and Health Insurance Guaranty Association protects eligible Texas policyholders if a covered member insurer becomes insolvent and cannot meet obligations.

A Texas producer cannot use guaranty association protection as a sales inducement. Coverage exists as a safety net, not as a reason to buy a policy.

For a covered insurer insolvency, Texas guaranty association protection for life insurance death benefits is limited by statute; the commonly tested maximum is $300,000.

Texas guaranty association protection for the present value of covered annuity benefits is limited; the commonly tested maximum is $250,000 per covered individual.

Texas guaranty association protection for covered health insurance benefits is subject to statutory limits; the commonly tested maximum is $500,000.

In Texas group life insurance, covered members receive certificates explaining their coverage, beneficiary rights, conversion rights, and claim procedures. The master policy stays with the policyholder.

A Texas group life participant who loses eligibility can convert to an individual policy during the conversion window without proving insurability.

Texas does not have a state mini-COBRA law for small employers. Workers outside federal COBRA must look to options such as marketplace coverage, spouse coverage, Medicaid, CHIP, or other individual coverage.

Federal COBRA applies in Texas to covered employers with enough employees to meet the federal threshold. Texas does not add a separate state continuation law for smaller employers.

Texas did not expand Medicaid under the ACA. Texas Medicaid covers limited categories, while CHIP helps cover eligible children in families above Medicaid limits.