State RegulationsTX specificDifficulty 2/5
The Commissioner adopts a rule that contradicts an express provision of the Texas Insurance Code. Which provision governs?
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Answer & full 3-part explanation (select an option above, or peek)
Why D is correct
Under TIC 31.001-.002 and 31.021-.022, the Commissioner's rulemaking power is authority to administer and enforce the Insurance Code, not to rewrite it. A rule that contradicts or goes beyond an express statutory provision is invalid to that extent, and the statute governs. Practical consequence: a licensee may rely on the statute over a conflicting rule, but cannot rely on an invalid rule as a defense to an enforcement action.
Why the other options are wrong
- A) The hierarchy is the same for every regulated person; a conflicting rule does not bind licensees while yielding to the statute for insurers.
- B) Recency does not resolve a conflict between a statute and an agency rule; the hierarchy does, and the statute stands higher.
- C) Administering agency status does not let a rule override the governing statute, because agency authority is delegated and bounded by the Code.
Memory hook
The statute outranks the rule, because TDI administers the Code rather than amends it.