Texas State Insurance Laws Vocabulary Flashcards

Practice flashcards covering key terms, definitions, and legal specifics from the Texas State Insurance Laws lecture notes.

Commissioner of Insurance

The Chief Executive and Administrative Officer of the Texas Department of Insurance ($TDI$), appointed by the governor for a $2$-year term.

Authorization

A permit, license, certificate of authority, registration, or other authorization issued or granted by the Commissioner.

Contested Case

A proceeding in which the legal rights, duties, or privileges of a party are to be determined by a state agency, requiring at least $10$ days' notice for a hearing.

Certificate of Authority

An authorization an insurance company must obtain to transact insurance in Texas, remaining effective until suspended or revoked.

Domestic Insurer

An insurance company organized under the laws of Texas, whether or not it is admitted to do business in the state.

Foreign Insurer

An insurance company organized under the laws of another U.S. jurisdiction (another state), whether or not it is admitted to do business in Texas.

Alien Insurer

An insurance company organized under the laws of a jurisdiction outside the United States.

Stock Insurer

An insurance company owned by stockholders or shareholders that issues non-participating policies and pays taxable dividends.

Mutual Insurer

An insurance company owned by its policyholders (members) that issues participating policies and pays non-taxable dividends.

Agent

A person authorized and licensed to transact insurance on behalf of an insurer, including individuals, partnerships, and corporations.

Controlled Business

Insurance business on risks the person controls through ownership, mortgage, family relationship, or employment; at least $25\%$ of premium volume must come from the general public.

Nonresident Agent

An agent who resides in another state but holds a license to solicit insurance in Texas based on reciprocity with their home state.

Temporary Agent License

A license valid for $180$ days issued without a written exam to applicants being considered for appointment as full-time agents.

Appointment

An authorization by an insurer for a licensed agent to transact insurance on its behalf.

Fiduciary Capacity

A standard of conduct where an agent is placed in a position of trust and confidence, especially when handling premium funds.

Commingling

The unethical act of mixing personal funds with funds belonging to the insurance company or client.

Texas Life and Health Insurance Guaranty Association

An entity created for the payment of claims or continuation of policy obligations for financially impaired or insolvent insurers.

Illustration

A presentation or depiction used to solicit or sell a life insurance policy, showing non-guaranteed elements over a period of years.

Buyer’s Guide

A generic brochure developed by the $NAIC$ to assist prospective purchasers in comparing costs and basic types of insurance products.

Twisting

The prohibited practice of making misleading representations or incomplete comparisons to induce a person to lapse or forfeit a policy to take out one with another insurer.

Defamation

The publication or circulation of false or derogatory statements intended to injure any person or organization in the insurance business.

Rebating

Offering or giving any valuable consideration not stated in the policy, such as a return of premium, to induce the purchase of insurance.

Chemical Dependency

The abuse of, psychological or physical dependence on, or addiction to alcohol or a controlled substance.

$ACA$ Bronze Plan

A health insurance level of coverage that covers $60\%$ of the benefit costs.

$ACA$ Silver Plan

A health insurance level of coverage that covers $70\%$ of the benefit costs.

$ACA$ Gold Plan

A health insurance level of coverage that covers $80\%$ of the benefit costs.

$ACA$ Platinum Plan

A health insurance level of coverage that covers $90\%$ of the benefit costs.

Essential Health Benefits Package

A set of $10$ benefit categories, such as maternity care and hospitalization, that must be offered by every plan in the health insurance marketplace.