Texas Insurance Limited Lines Practice Exam

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• What is the term for making unfair discrimination between individuals?
• Which of the following actions is considered an example of fraud in insurance?
• What is the term for the maximum amount an insurer pays for a single claim?
• What is the term for the process used by the claims department that includes an assessment of damages?
• In insurance terminology, what is defined as the return of premiums?
• What are agents not allowed to imply about coverage under a policy?
• What must insurers provide to clients after completing their investigation of a claim?
• What is one of the key components of liability coverage in automotive insurance?
• What is the purpose of deductibles in an insurance policy?
• What factors are considered during the underwriting process?
• What must a licensed individual have to engage in insurance business?
• What is the consequence for insurers attempting to settle claims without reasonable investigation?
• What does the term 'Subrogation' refer to?
• What is an insurance policy endorsement?
• What is required before a license can be suspended or revoked?
• Who owns mutual policies in an insurance context?
• Who has strict limitations on the type of business they can conduct?
• Making a false claim on an insurance policy is referred to as what?
• Can a cease and desist order be issued without a prior hearing?
• What is an agent required to do regarding the sourcing of their premiums?
• How can a limited lines insurance agent expand their practice?
• When is salvage value most often calculated in the insurance process?
• Which insurance term refers to coverage that applies when the specific limits of a policy are surpassed?
• In insurance terms, what does 'subrogation' refer to?
• What is a health insurance exclusion?
• What is typically the outcome for items categorized as salvage?
• In which situation might an insurance policy provide limited coverage?
• What is the minimum property damage coverage required in Texas for auto insurance?
• What does 'subrogation' refer to in the insurance industry?
• Which act mandates accurate reporting of a consumer's credit history by insurance companies?
• What term is used to describe agreements in property insurance to align insurance risk with the amount of premium charged?
• What is considered a civil wrong other than a breach of contract?
• What does the term 'loss' refer to in an insurance context?
• What is the type of liability where an individual is responsible for risks associated with inherently dangerous activities?
• What does the term 'depreciation' refer to in insurance?
• Insuring and restoring to the same financial condition is primarily aimed at?
• Which of the following actions could lead to license revocation?
• Advertisements must not imply what kind of guarantee?
• What is one duty of a managing general agent (MGA)?
• What does the term 'hazard' signify in insurance?
• What term is used for things that are not covered in a policy?
• What are the continuing education requirements for a limited lines agent in Texas?
• How often must the Commissioner review all domestic insurance policies?
• What is the maximum fine the Commissioner may impose for violations instead of revoking a license?
• What should a policyholder receive when their claim is denied?
• What is the duration of validity for an emergency license?
• What must the commissioner provide before taking action against an agent?
• In which scenario would vicarious liability be applicable?
• What must testimonials adhere to when used in advertisements for insurance?
• What type of protection does the Texas Insurance Guaranty Association provide?
• What is a broker's primary role in the insurance industry?
• Which action is NOT considered an unfair claims practice?
• Can more than one agent hold an active license of the same type at the same time?
• What is the purpose of the Texas Insurance Guaranty Association (TIGA)?
• Which of the following is exempt from the auto Financial Responsibility Law?
• In an insurance policy, what part includes the insurer's promise to pay the insured?
• What is the primary purpose of the Texas Department of Insurance (TDI)?
• Who is the person making a sworn oath to the value of the damage?
• What do you call the voluntary relinquishment of a known right?
• What is the maximum duration of a temporary license for life insurance or casualty products?
• What term is used to describe Boycotts, Coercion, and Intimidation?
• If a license lapses for more than 90 days but less than 1 year, what happens to the license?
• What is prohibited under the guidelines of the insurance industry regarding competitive practices?
• What kind of coverage is typically not included in a basic insurance policy?
• What is the primary requirement for a nonresident agent wishing to transact insurance business in Texas?
• What is the role of the commissioner regarding agents?
• What is a coverage limit?
• What basic information is required in an insurance contract?
• What type of coverage does an endorsement typically modify?
• Which entity must be in good standing in any US state to be considered a corporate general lines agency?
• Why is it important for an insurance agent to manage client funds responsibly?
• In terms of complaint record-keeping, what requirement do insurers have?
• What must an agent do before charging certain fees to clients?
• When both the occupant and the contents have been removed from a property, what term best describes this condition?
• Who must maintain a place of business in Texas to be licensed as an insurance agent?
• What is the main function of the Texas Association of Insurance Agents (TAIA)?
• Which term describes a temporary insurance contract that can be verbal or written?
• What is the consequence of commingling funds as an insurance agent?
• What is the minimum number of Continuing Education hours required before license renewal every two years for agents?
• How many months of advance notice must a company provide an agent before canceling their contract after two years?
• What does actuarial science contribute to the insurance field?
• What responsibility does an agent have regarding premium payments?
• What is necessary for a foreign insurance agency to operate in Texas?
• What term describes property deemed not repairable by the insurance company?
• Who is entitled to a hearing in court if their license is about to be suspended or revoked?
• What must be done if a person is compensated for providing a testimonial in an advertisement?
• Which type of liability holds one party accountable for the negligent actions of another party?
• Which type of insurance provides coverage beyond the primary policy limits?
• What type of discrimination is considered unethical in the insurance industry?
• What term refers to offering rebates of premiums as an inducement to purchase insurance?
• What qualification must an individual meet to receive a surplus lines agent license?
• What can the commissioner issue alongside a temporary license?
• How long does an agent have to notify the TDI of a change in their business address?
• What is the primary role of a risk manager?
• What concept deals with the liability associated with defective products?
• What is the minimum age requirement to act as a licensed insurance agent?
• Which type of companies do not always provide stocks that pay dividends?
• Which of the following best describes 'exclusions' in an insurance policy?
• What is a 'premium audit'?
• What does the term "risk" refer to in insurance?
• What term describes companies organized under the law of another country, such as Mexico?
• What is considered an unfair practice regarding the settlement offers to policyholders?
• Which license type has restrictions on business types?
• What is a claim?
• What would be a possible penalty for an agent found guilty of misrepresentation?
• What might trigger the suspension or cancellation of an insurance license by the Commissioner?
• What is the primary purpose of salvage in insurance?
• What is a specific restriction on MGAs who wish to sell insurance?
• In a scenario where a vehicle is damaged, what type of loss is incurred while the vehicle is being repaired?
• How does the Texas Department of Insurance handle consumer complaints?
• What does the Texas Insurance Code regulate?
• What is necessary for a nonresident agent to transact business in Texas other than having a similar license in their home state?
• What is the difference between whole life and term life insurance?
• What should insurers do if they receive a claim and require additional information?
• Which of the following is a key function of the Texas Department of Insurance?
• In insurance, making dishonest representations can lead to which consequence?
• What is a requirement for an MGA to be licensed?
• What type of hazard is associated with illegal activities?
• What do you call a Texas insurance company that is licensed to operate in another country?
• Which of the following statements is true regarding insurance claims?
• Who is not required to obtain an insurance license?
• What does the term 'insured' refer to in an insurance policy?
• Misrepresentation is defined as making false statements regarding which of the following?
• What does an agent's fiduciary duty entail?
• What does 'underwriting risk' mean?
• What role does the National Association of Insurance Commissioners (NAIC) play?
• What requirement does a bank have to meet to be licensed as a general lines property and casualty agent?
• Additional insurance coverage can be categorized as what?
• What is an example of negative action affecting underwriting?
• What requirement must a corporate general lines agency fulfill regarding claims?
• What does unfair comparison refer to in insurance marketing?
• What is a requirement for signing and delivering insurance policies?
• What does ‘adverse selection’ refer to in insurance?
• What must the insured provide after an incident to substantiate their claim?
• Which practice is prohibited as it can hurt competition in the insurance industry?
• What is one of the primary duties of an insurance agent?
• Once an agent makes an appointment, what is the maximum duration for which it is valid?
• How many hours of continuing education are needed in total for licensing?
• What is the primary federal law that governs insurance company practices?
• Which of the following practices is discouraged to influence claim settlements?
• What is the term for insurance companies that allow for profit sharing with their members?
• What is the penalty for operating as an agent without a license in Texas?
• What must accompany the application for a surplus lines license in Texas?
• If an insurance agent fails to recommend necessary coverage, what could occur?
• Which term describes the possibility of a loss due to a surrounding risk or hazard?
• Can an insurance agent charge additional fees if they also receive a commission?
• What is a necessary condition for a company to accept business from a managing general agent (MGA)?
• What is required to obtain a limited lines insurance license in Texas?
• What type of information must insurance agents disclose to clients concerning policy terms?
• Which of the following is an exemption to the Continuing Education requirements?
• What differentiates primary insurance from excess insurance?
• What is the role of the Commissioner regarding an agent's license?
• Which of the following best describes “excess insurance”?
• Which designation is exempt from taking the written property/casualty examination?
• Which of the following best describes an ‘adjuster’?
• Define 'co-insurance' in insurance policies.
• What is the minimum age required to be fingerprinted, pass the exam, and obtain an insurance license?
• What term refers to the individual who purchases an insurance policy?
• Which term refers to a written insurance contract outlined in a policy?
• What type of hazards would typically be covered under strict liability?
• What might result if a limited lines agent fails to complete the renewal process?
• How do 'excess and surplus lines' differ from standard insurance?
• What is generally required for an insurance claim to be processed?
• What term is used for expenses incurred due to a direct loss?
• Which term refers to the amount paid by the insurer for a total loss?
• What is an insurance binder?
• What percentage of an agent's total volume of premiums must come from uncontrollable sources?
• How often must a limited lines insurance agent renew their license in Texas?
• What do property and casualty policies often include to affect third-party rights?
• What is the main purpose of reinsurance?
• Under what circumstance is an emergency license issued?
• What are limitations in an insurance policy?
• What is a rider in an insurance context?
• What does the term 'grace period' in insurance refer to?
• What increases the probability or severity of loss due to a peril?
• Which of the following best describes a 'non-renewal' in insurance?
• What typically results from the application of deductibles in an insurance policy?
• Which entity typically performs underwriting in the insurance industry?
• Which of the following best defines 'estoppel'?
• What is a policyholder?
• What typically triggers the consideration of excess insurance?
• What does it typically indicate if a property is classified as salvage?
• Which types of insurance may personal lines agents sell?
• What defines a limited lines insurance agent in Texas?
• Define 'insurance fraud.'
• What is the role of a claims adjuster?
• Under what conditions can insurance agents share commission?
• What is the primary purpose of the Consumer Bill of Rights in insurance?
• What must an agent do if they receive a request for a non-compliant action?
• What is a common reason for an agent to be placed on disability probation?
• What is required of a temporary agent within 14 days of their appointment?
• What should agents include in their records of transactions?
• What term refers to the agent/insurance company customers and policyholders?
• Selling a policy by providing false information is known as what?
• Who is referred to as the first party in an insurance contract?
• What is the term used for a process that resolves disputes by having both parties present their case to a neutral third party?
• What does the term 'waiver' imply in a legal context?
• How long does the Texas Department of Insurance allow for a company to acknowledge communication regarding a claim?
• Which of the following is NOT a responsibility of an MGA?
• What does salvage refer to in terms of insurance claims?
• What is an insurance agency that operates within its home state called?
• What does 'continuity of coverage' imply in the context of insurance?
• What is the role of an insurance claims adjuster?
• How many hours of continuing education are required to renew a license?
• What is a non-admitted insurer?
• What does fiduciary mean in the context of an insurance agent?
• What is prohibited for property and casualty agents regarding insurance amounts?
• What type of insurance typically covers bodily injury and property damage?
• What does underwriting involve in the context of insurance?
• What act requires insurance companies to provide customers with a fair credit report?
• Who is responsible for enforcing the insurance laws?
• How does a 'network' affect health insurance coverage?
• Which of the following is a function of insurance subrogation?
• Which of the following is a primary duty of an insurance agent?
• What do you call a true statement made about a person?
• What are the possible penalties for violating the Unfair Competition and Unfair Practices Law?
• What is defined as making a false statement about someone that causes harm?
• Which type of hazard is defined as any hazard that can be seen, felt, or touched?
• What does absolute liability not depend on?
• What classification does an insurance company have if it has a presence both domestically and internationally?
• In property insurance, how is 'actual cash value' calculated?
• What type of marketing practice involves using deceptive advertising?
• Which type of insurance is a limited lines agent in Texas typically authorized to sell?
• How long must agents retain proof of Continuing Education hours?
• Which statement is true regarding the renewal of policies after termination?
• What regulates the foreign insurance agencies wishing to operate in Texas?
• What is one consequence of failing to maintain a limited lines insurance license in Texas?
• Which of the following would likely not be regarded as salvage?
• What type of policy pays out only after another policy has made a payment?
• What is the term for making false statements about an insurer's financial condition with the intent to deceive?
• What does a significant component of an insurance agent's job involve?
• What does deductible mean in insurance terms?
• What type of risk is involved when there is no possibility of gain?
• Which of the following is not permitted concerning the advertisement of insurance companies?
• Before an insurer can deny a claim, they are required to do what?
• In Texas, what is the minimum auto liability coverage required for bodily injury?
• What is considered controlled business in the context of insurance agents?
• What happens if an agent incorrectly advises about coverage?
• Which of the following terms refers to a refund of a portion of the premium paid?
• What is typically included in the insurance agreement between the insurer and the insured?
• What type of risk represents the possibility of a reduction in value?
• What term is used to describe the ratio of loss to total premiums received?
• Which unethical practice involves inducing a policyholder to surrender their insurance?
• The maximum amount an insured can collect per occurrence is indicated by which term?
• How often must a license be renewed if a person has held it for 20 years?
• Which of the following roles does the Texas Department of Insurance NOT perform?
• What does 'aggregate limit' refer to in insurance policy terms?
• Which act involves coercion or intimidation in the insurance context?
• What is the primary purpose of coinsurance in property insurance?
• Why is reinsurance considered important for insurance companies?
• What does disparagement involve in insurance advertising?
• What is one key difference between excess insurance and primary insurance?
• What type of inducement is prohibited in insurance transactions?
• What does personal injury protection (PIP) coverage provide?
• What is the purpose of an exclusion in an insurance policy?
• What is the main requirement for using statistics in insurance advertisements?
• Which of the following is an example of rebating in the insurance industry?
• What does the notification of a claim's denial ideally include?
• If an agent operates outside his duties based on verbal instructions, what power is he using?
• Which type of insurance-related fraud involves knowingly providing false information?
• What happens to an agent's appointment if it is withdrawn by the agent?
• Who must hold an appropriate Texas insurance agent's license in a corporate agency?
• If a contract provision causes a denial of coverage, what must the insurer provide to the claimant?
• Which type of hazard is defined as any hazard that is not illegal?
• What are 'loss runs' in the insurance context?
• The 'innocent spouse rule' serves to protect whom?
• What is one of the requirements for insurers when conducting investigations of claims?
• Which of the following involves the concept of liability being transferred to another party in a contract?
• What type of fees can an insurance agent charge?
• Which of the following is NOT a duty of an insurance service representative (ISR)?
• What is typically required by a commissioner to authorize temporary licenses?
• What type of loss is described as a direct result of an event?
• Which of the following terms refers to risks that cannot be directly observed?
• What is an amendment added to an insurance policy to modify its terms called?
• How is a random unexpected event best described?
• What is an insurer's obligation to an insured in terms of claims?
• What principle ensures that an insured's coverage remains consistent when switching policies?
• Which type of risk allows for the possibility of both gain and loss?
• Which practice involves making unfair discrimination between individuals of the same class in insurance?
• What term refers to the direct cause of loss in an insurance context?
• What happens to property classified as salvage?
• Which of the following duties is NOT a responsibility of the insurance agent?
• Who is responsible for checking if policies are being sold or not?
• Which term defines the risk associated with potential financial loss?
• What is the term for the involuntary relinquishment of a known right?
• Who may share a commission with a person holding a limited liability license?
• What does the term 'Indemnity' refer to?
• What action is required from individuals who have knowledge of fraud in the insurance industry?
• What is NOT categorized under ethical requirements in insurance?
• Which responsibility does an insurance agent have toward the insured?
• What is the role of insurers in the insurance process?
• What is a significant characteristic of an alien insurer?
• What is the crucial indicator of financial performance in insurance known as the loss ratio?
• What does "fraud" represent in the context of insurance?
• What must an agent do upon terminating a sub-agent according to Texas regulations?
• What is a 'loss ratio' in insurance?
• What is a premium in the context of insurance?
• Which of the following best defines a morale hazard?
• What does "market value" refer to in context of property?