Texas Statutes and Rules Pertinent to Life Insurance Only

An individual covered under a group life insurance policy may convert the policy to any of the following EXCEPT A. 20-pay life B. Life paid up at age 65 C. Whole Life D. 15-year level term

15-year level term

Conversion to an individual whole life policy is permitted without evidence of insurability within how many days of the termination of employment?

31 days

How long is the grace period in group policies?

31 days

If a policyowner surrenders his life insurance policy that has been in force for 5 years within 60 days after the premium due date, what will the insurer be required to pay? a paid-up nonforfeiture benefit, nothing, the death benefit, a cash surrender value

A cash surrender value

Which of the following is used to compare the cost of one life insurance policy against another in order to guide prospective purchasers to policies that are competitively priced? A. Cost comparison methods B. Policy cost guides C. Consumer priced indices D. Policy cost indices

Cost comparison methods

Which of the following is TRUE about credit life insurance? A. Debtor is the annuitant. B. Creditor is the insured. C. Debtor is the policy beneficiary. D. Creditor is the policyowner.

Creditor is the policyowner.

Which of the following is NOT allowed in credit life insurance? A. Creditor requiring that a debtor buys insurance from a certain insurer B. Creditor having a collateral assignment on the policy C. Creditor requiring that a debtor has a life insurance D. Creditor becoming a policy beneficiary

Creditor requiring that a debtor buys insurance from a certain insurer

Which of the following must be included in all life insurance advertisements? A. Names of any parent companies B. Contact information for the Commissioner of Insurance C. Contact information for each local office of the insurer D. Identity of the actual insurer

Identity of the actual insurer

Which of the following documents must be provided to the policyowner or applicant during policy replacement? A. Notice Regarding Replacement B. Disclosure Authorization Form C. Buyer's Guide and Policy Summary D. Policy illustrations

Notice Regarding Replacement

During replacement of life insurance, a replacing insurer must do which of the following? A. Designate a new producer for a replaced policy B. Send a copy of the Notice Regarding Replacement to the Department of Insurance C. Obtain a list of all life insurance policies that will be replaced D. Guarantee a replacement for each existing policy

Obtain a list of all life insurance policies that will be replaced

Which rule would apply if an agent knows an applicant is going to cash in an old policy and use the funds to purchase new insurance? A. Replacement rule B. Reinstatement rule C. Conversion rule D. Disclosure rule

Replacement rule

Which of the following is NOT required on an illustration used in the sale of a life insurance policy? A. Generic name of policy B. Name of insurer C. Underwriting or rating classification upon which the illustration is based D. The name of the primary and secondary beneficiaries

The name of the primary and secondary beneficiaries

Which of the following types of insurance policies is most commonly used in credit life insurance? whole life, equity indexed life, decreasing term, increasing term

decreasing term

When possible, what should insurers strive to eliminate from illustrations?

footnotes and caveats

All advertisements are the responsibility of the

insurer

The initial amount of credit life insurance may NOT exceed A. an amount set by statute and adjusted regularly for inflation B. the borrower's monthly income C. the borrower's annual income D. the amount to be repaid under the contract

the amount to be repaid under the contract

Is it illegal for an insurance company to advertise that it is the leader of the financial industry and therefore pays the most claims each year? A. Yes; advertisements must not mislead the public in terms of financial standing B. Yes, as long as no one can prove otherwise C. No, as long as the advertisement has a disclaimer that all facts are misleading D. No

Yes; advertisements must not mislead the public in terms of financial standing

Upon the submission of a death claim under a life insurance policy, when should the insurer pay the policy benefit? A. immediately after receiving written proof of loss B. on the next anniversary of the policy C. within 30 days D. within 2 months

within 2 months

If a person is compensated for a testimonial in an advertisement, which of the following statements should be included in the advertisement? A. Commissioned advertisement B. Paid endorsement C. Insurer is not responsible for the contents of the testimonial D. The author is the employee of the insurer

Paid endorsement

What is the main purpose of the regulation on life insurance policy illustrations? A. To help producers submit proper reports to the department of insurance B. To present a life policy in a visual way C. To help customers make educated decisions in buying life insurance D. To compare life policies

To help customers make educated decisions in buying life insurance

Which of the following CANNOT be included along with illustrations used to sell life insurance? A. Rating information B. Original death benefit C. Vanishing premium information D. Name of the insurer

Vanishing premium information

An insured in a group policy has misstated his age on the insurance application. As a result, the insurer will most likely A. cancel the coverage B. impose a fine on the insured C. issue an amended policy D. adjust the premium

adjust the premium

Which of the following is correct regarding credit life insurance? A. It has a maximum term of 20 years B. It insures the life of a debtor C. It is purchased on an installment basis D. It insures the life of a creditor

it insures the life of a debtor

All of the following are mandatory life insurance policy provisions EXCEPT A. grace period B. policy backdating C. misstatement of age D. incontestability

policy backdating

The type of insurance sold to a debtor and designed to pay the amount due on a loan if the debtor dies before the loan is repaid is called

credit life

How long is the incontestability period in group life insurance policies issued in Texas?

2 years

An advertisement must accurately represent which of the following? A. The insurer's assets B. The insurer's corporate structure C. The insurer's financial standing D. All of the above

All of the above

All of the following information must be disclosed to the viator prior to the execution of a viatical settlement contract EXCEPT A. Tax consequences resulting from entering into a settlement B. The amount of compensation received by any person from the viatical settlement C. Availability of stranger-oriented life insurance (STOLI) D. Alternatives to the viatical settlement

Availability of stranger-oriented life insurance (STOLI)