Texas General Lines — Property and CasualtyTexas Laws and RegulationsMedium
A Texas-licensed producer is found guilty of insurance fraud. In addition to criminal penalties, what administrative action may the Commissioner of Insurance take against the producer's license?
- ASuspend or revoke the producer's license.
- BImpose a civil penalty of up to $1,000 only.
- CIssue a warning letter only.
- DRequire additional continuing education in fraud prevention.
Show answer & explanationAnswer & explanation
Correct answer: A. Suspend or revoke the producer's license.
Insurance fraud is a serious offense that can lead to severe administrative penalties, including the suspension or revocation of a producer's license by the Commissioner of Insurance, in addition to any criminal charges.
Why the other options are wrong
- B. A $1,000 penalty is too low for fraud, and it doesn't address the license status.
- C. A warning letter is insufficient for a fraud conviction.
- D. While additional CE might be part of remediation, it's not the primary administrative action for fraud.
Administrative Action for Insurance Fraud (Texas)
The disciplinary measures the Texas Commissioner of Insurance can take against a licensed producer found guilty of insurance fraud, beyond any criminal prosecution.
- Fraud is a serious violation of insurance law.
- License suspension or revocation is common.
- Aims to protect the public and integrity of the industry.
Memory trick: Fraud equals freedom lost and license revoked!