Texas General Lines — Property and CasualtyTexas Laws and RegulationsMedium
A Texas-licensed producer receives a premium payment from a client. The producer must deposit this payment into a trust account or remit it to the insurer. What is the maximum number of days the producer has to deposit or remit the funds after receiving them?
- A5 business days
- B10 calendar days
- C15 calendar days
- D3 business days
Show answer & explanationAnswer & explanation
Correct answer: B. 10 calendar days
In Texas, a producer must deposit premiums into a trust account or remit them to the insurer within 10 calendar days of receipt. This ensures proper handling of client funds.
Why the other options are wrong
- A. 5 business days is too short and specified in business days instead of calendar days.
- C. 15 calendar days exceeds the maximum allowable period for remitting premiums.
- D. 3 business days is too short for the required remittance period.
Premium Remittance Deadline (Texas)
The maximum period a Texas-licensed producer has to deposit premium funds into a trust account or remit them to the insurer after receiving them from a client.
- Applies to all premium payments.
- Ensures fiduciary responsibility.
- Expressed in calendar days.
Memory trick: Ten calendar days to handle client cash, or face a regulatory crash.