State RegulationsTX specificDifficulty 2/5
Under TIC 1101.051, to which life insurance policies do the Texas prohibited-provisions restrictions apply?
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under TIC 1101.051, the prohibited-provisions subchapter applies to a life insurance policy that is issued or delivered in Texas, and also to a policy issued by a company organized under Texas law even if the policy is delivered elsewhere. The test therefore turns on Texas delivery or the insurer's Texas organization, not on the insured's residence or on where the agent is licensed. In practice this means a Texas-domiciled insurer must comply with the prohibited-provisions rules even on forms delivered out of state.
Why the other options are wrong
- A) The insured's residence is not the trigger under TIC 1101.051, and nothing in the subchapter depends on whether the policy is contestable.
- C) The insurer's home office location is not the test; TIC 1101.051 reaches policies issued by a company organized under Texas law and policies issued or delivered in Texas.
- D) The place of solicitation or the agent's licensure is not the trigger; the trigger is issuance or delivery in Texas, or issuance by a Texas-organized company.
Memory hook
Prohibited provisions follow Texas delivery or a Texas-organized insurer.