Texas General Lines — Property and CasualtyTexas Laws and RegulationsHard
A Texas-licensed producer is found to have violated a provision of the Texas Insurance Code. The Commissioner of Insurance issues a cease and desist order against the producer. If the producer violates this order, what is the maximum administrative penalty that the Commissioner may impose for each violation?
- A$25,000
- B$5,000
- C$10,000
- D$1,000
Show answer & explanationAnswer & explanation
Correct answer: A. $25,000
Under the Texas Insurance Code, if a person violates a cease and desist order, the Commissioner of Insurance may impose an administrative penalty not to exceed $25,000 for EACH violation.
Why the other options are wrong
- B. $5,000 is a possible general penalty, but not the maximum for this specific violation.
- C. $10,000 is a significant penalty, but the maximum for violating a cease and desist order is higher.
- D. $1,000 is a common general penalty but too low for violating a cease and desist order.
Penalty for Violating Cease & Desist Order (Texas)
The maximum administrative fine that the Texas Commissioner of Insurance can levy against a person who fails to comply with a cease and desist order.
- Applies per violation.
- Imposed by the Commissioner.
- A serious penalty for non-compliance.
Memory trick: Cease and desist? Ignore at your $25,000 peril!