State RegulationsTX specificDifficulty 2/5
A life insurer incorporated in Texas keeps its only claims office in another state and is managed from there. Under TIC 841.001, how is the insurer classified in Texas?
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
TIC 841.001(4) defines a domestic insurance company as one organized under the laws of this state as a life insurance company, an accident insurance company, a life and accident insurance company, a health and accident insurance company, or a life, health, and accident insurance company. The test is the law under which the company is organized, not where its offices, employees, or management are located.
Why the other options are wrong
- B) Where the offices and operations sit does not control the classification.
- C) Management from another state is not organization under a foreign country's laws.
- D) Being authorized in several states does not change a company's classification in any one of them.
Memory hook
Classification follows the charter, not the address.