Texas Statutes and Rules Pertinent to Life Insurance Only

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How must a replacing producer respond to an applicant wishing to replace existing life insurance?

The producer must provided the applicant with a notice regarding replacement

What is the main purpose of the regulation on life insurance policy illustrations?

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?

Vanishing premium information

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

Which of the following is correct regarding credit life insurance?

It insures the life of a debtor

All of the following are mandatory life insurance policy provisions EXCEPT

Policy backtdating

Which of the following is TRUE regarding the insurance amount in a credit life policy?

The creditor can only insure the debtor for the amount owned

An advertisement must accurately represent which of the following?

all of the above

During replacement of life insurance, a replacing insurer must do which of the following?

Obtain a list of all insurance polices that will be replaced

Viatical settlements may be rescinding within what time period after the viator receives the proceeds?

15 days

An insured in a group policy has misstated his age on the insurance application. As a result, the insurer will most likely

Adjust the premium

All of the following information must be disclosed to the viator prior to the execution of a viatical settlement contract EXCEPT

Availability of stranger-orginated life insurance (STOLI)

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?

Cost comparison method

Which of the following would be the beneficiary in credit life insurance?

Creditor

Upon the submission of a death claim under a life insurance policy, when must the insurer pay the policy benefit?

Within 2 months

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?

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

All advertisements are the responsibility of the

insurer

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

Footnotes and caveats

What provision in a life or health insurance policy extends coverage beyond the premium due date?

Grace period

Which of the following must be included in all life insurance advertisements?

Identify of the actual insurer

An individual covered under a group life insurance policy may convert the policy to any of the following EXCEPT

15-year level term

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

2 years

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

31

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 cash surrender value

All of the following statements are correct regarding credit life insurance EXCEPT

Benefits are paid to the borrower's beneficiary

Which of the following is TRUE about credit life insurance?

Creditor is the policyowner

Which of the following is NOT allowed in credit life insurance?

Creditor requiring that a debtor buys insurance from a certain insurer

If a person is compensated for a testimonial in an advertisement, which of the following statements should be included in the advertisement?

Paid endorsement

Which of the following types of insurance policies is most commonly used in credit life insurance?

Decreasing term

The usage of words or symbols that are similar to what entity is prohibited in life insurance advertisements?

Federal Government

Which of the following documents must be provided to the policyowner or applicant during policy replacement?

Notice regarding Replacement

According to the state nonforfeiture law for life insurance policies, insurers must offer at least one of the following nonforfeiture options EXCEPT

Reduction of premium

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?

Replacement Rule

The initial amount of credit life insurance may NOT exceed

The amount to be repaid under the contract

Which of the following is NOT required on an illustration used in the sale of a life insurance policy?

The name of the primary and secondary beneficiaries


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