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.