State RegulationsTX specificDifficulty 2/5
TDI opens an examination of a Texas life and health agency. What must the license holder be able to do with respect to its insurance business records?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under TIC 4001.254-.255, a license holder must maintain books and records of its insurance business in a form that allows TDI to determine whether the licensee is complying with the Insurance Code and TDI rules, and must make those records available to TDI for examination on request. TDI's examination authority is statutory and does not depend on a subpoena or court order, and a licensee cannot escape the duty by destroying records or by pointing to where a transaction occurred.
Why the other options are wrong
- A) The record-keeping duty covers the licensee's insurance business records; it is not limited by the residency of the customer.
- B) Renewal does not authorize the destruction of records; the duty is to keep whatever is needed to show compliance.
- D) TDI's examination authority comes from the Insurance Code, so a subpoena or court order is not a prerequisite.
Memory hook
If TDI cannot read your books to check compliance, the records requirement is not met.