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One rule, 2 ways the exam asks it. Same knowledge point, different phrasing — work through all of them, because the exam rarely reuses the wording.

State RegulationsTX specificDifficulty 2/5

A Houston agency owner ends an agent's appointment with one insurer after that agent stops writing the insurer's business. What is the effect of the appointment ending?

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Answer & full 3-part explanation (select an option above, or peek)

Why C is correct

Under TIC 4001.201-.206, an appointment is insurer-specific: it is filed by the insurer and it is the source of the agent's authority to act for that insurer. When it ends the agent must stop soliciting and writing new business for that insurer, and the insurer must notify TDI of the termination. The agent's license itself is unaffected, because a Texas license is issued by TDI and is not owned or controlled by the appointing insurer.

Why the other options are wrong

  • A) Suspension is a disciplinary action taken by TDI against a license; ending an appointment is an insurer's business decision and does not affect the license.
  • B) An insurer's written consent cannot create authority that depends on an appointment being on file with TDI.
  • D) Appointments never transfer between insurers; every insurer must file its own appointment for the agent.

Memory hook

The license comes from TDI; the appointment comes from the insurer, and it dies with the insurer's termination.

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State RegulationsTX specificDifficulty 3/5

An insurer terminates an agent's appointment after a dispute over production. What is the effect of that termination on the agent's Texas license?

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Answer & full 3-part explanation (select an option above, or peek)

Why C is correct

Under TIC 4001.201-.206, an appointment is a relationship between one agent and one insurer; it is not the license itself. When the insurer ends the appointment, the agent simply loses authority to represent that insurer. The license is issued by the department and continues in force until it expires or until the department revokes, suspends or otherwise acts on it under TIC 4005.101-.102. Losing one appointment therefore does not end the agent's career, and the agent may be appointed by another insurer as soon as that insurer files the appointment.

Why the other options are wrong

  • A) Revocation is a departmental sanction under TIC 4005.101-.102, not an automatic consequence of an insurer ending an appointment.
  • B) Suspension is likewise a departmental action; an insurer's business decision to terminate an appointment cannot suspend a license.
  • D) A license does not lapse for want of an appointment; it expires only at the end of its term, and there is no 90-day appointment cure period.

Memory hook

Losing an appointment costs you that carrier, not your license.

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