Texas Property & Casualty Insurance License Exam — All Questions
3 questions
Which agency regulates insurance and licenses resident property and casualty agents in Texas?
- a.The Texas Secretary of State
- b.The Texas Department of Insurance (TDI)✓
- c.The Texas Department of Motor Vehicles
- d.The Texas Railroad Commission
Insurance in Texas is regulated by the Texas Department of Insurance (TDI), which licenses agents and adjusters, reviews rates and forms, and enforces the insurance laws (tdi.texas.gov). On the exam, remember it is TDI, not the Secretary of State or DMV, that licenses property and casualty agents.
A Texas agent offers to rebate part of the commission to a client as an inducement to buy a policy. Under the Texas Insurance Code this is generally:
- a.Permitted if the insurer approves
- b.Permitted for commercial clients only
- c.Prohibited rebating✓
- d.Required to be disclosed but otherwise lawful
Giving any part of the premium or commission, or other valuable consideration not stated in the policy, as an inducement to buy is prohibited rebating under the Texas Insurance Code's unfair-practices provisions and can bring fines and license action by the Texas Department of Insurance.
After a Texas personal auto or homeowners policy is past its initial underwriting period, an insurer's mid-term cancellation is generally allowed only:
- a.For specific statutory grounds such as nonpayment of premium or fraud, with required advance written notice✓
- b.For any reason, with no notice
- c.Only during the first 24 hours of the policy
- d.Never, once the policy is issued
Texas limits mid-term cancellation of seasoned personal-lines policies to defined grounds such as nonpayment or fraud and requires advance written notice so the insured can replace coverage. The exact notice day-counts are set by statute and rule and can change; verify current figures with the Texas Department of Insurance.