State RegulationsTX specificDifficulty 2/5
Under TIC 4002.003, which of these persons may perform the activity described without holding a Texas agent license?
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Answer & full 3-part explanation (select an option above, or peek)
Why C is correct
Under TIC 4002.003, no agent license is required of an officer, director, or employee of an insurer whose duties are executive, administrative, clerical, or otherwise do not amount to the solicitation or negotiation of insurance. The exemption is defined by the activity, not by the job title. Practically, an unlicensed back-office employee may process paperwork and answer service questions, but the moment that employee begins explaining specific coverages or completing an application with a customer, the exemption is gone and a license is required.
Why the other options are wrong
- A) Explaining specific coverage and helping a customer complete an application is solicitation or negotiation, which the exemption does not cover.
- B) An independent contractor who solicits for compensation is acting as an agent and must be licensed; the exemption does not extend to outside solicitors.
- D) Holding oneself out as a consultant and charging a fee for advice about coverage is acting as an agent under the Code and requires a license.
Memory hook
Exempt for the paperwork, licensed for the pitch.