Texas General Lines — Life, Accident, Health and HMOTexas Statutes and Rules Common to Life, Accident, Health and HMOEasy
An insurance company wishes to introduce a new health insurance policy form for sale in Texas. Before this new form can be offered to the public, which of the following actions must the insurance company take regarding the Texas Department of Insurance (TDI)?
- ANotify the TDI of its intent to use the new form after 30 days.
- BSubmit the form to the TDI only if it includes an unusual benefit.
- CObtain approval from the TDI for the policy form.
- DFile the form with the TDI for informational purposes only.
Show answer & explanationAnswer & explanation
Correct answer: C. Obtain approval from the TDI for the policy form.
In Texas, all insurance policy forms, endorsements, and riders must be filed with and approved by the Texas Department of Insurance before they can be used or offered for sale to the public. This ensures compliance with state laws and consumer protection.
Why the other options are wrong
- A. Mere notification is not enough; explicit approval is mandated.
- B. All new forms, not just those with unusual benefits, require TDI approval.
- D. Filing for informational purposes is insufficient; approval is required.
Policy Form Approval (Texas)
All insurance policy forms, endorsements, and riders used in Texas must be filed with and approved by the Texas Department of Insurance (TDI) before they can be issued or delivered.
- Applies to all new and revised forms.
- Ensures compliance with state laws and regulations.
- Protects consumers from unfair or misleading provisions.
Memory trick: Before it sells, TDI must tell: 'It's approved, you're good to go!'