State RegulationsTN specificDifficulty 3/5
Which practice complies with the general rules of Tenn. Comp. R. & Regs. 0780-1-40 for Tennessee life illustrations?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Tenn. Comp. R. & Regs. 0780-1-40 requires illustrations to present guaranteed and nonguaranteed elements separately and clearly, so the applicant can see what the contract promises versus what the projections merely hope for. The Tennessee Department of Commerce & Insurance enforces the distinction because blurring it is the most common way illustrations mislead buyers.
Why the other options are wrong
- A) Omitting guaranteed values hides the contractual floor and defeats the rule's disclosure purpose.
- B) Calling nonguaranteed values guaranteed is the classic misrepresentation the rule forbids.
- C) The rule governs how illustrations are used in the sale; waiting until after collection avoids rather than satisfies the disclosure duty.
Memory hook
Two columns, clearly split: guaranteed on one side, hope on the other.