Texas Life Agent Practice Exam 2025 - Free Life Agent Practice Questions and Study Guide

The action of readjusting group premium rates based on loss or expense experience is permissible under the Unfair Practices section of insurance law. This practice is consistent with standard insurance industry practices, as insurers often adjust premiums in response to the collective experience of a group. This means that if the overall claims experience of a group changes, the premiums can be modified to reflect that experience. Such adjustments help ensure that the pricing reflects the actual risk and cost associated with insuring that group.

In contrast, misrepresenting policy benefits, charging excessive premiums, and failing to disclose policy limitations are considered unfair practices. These actions undermine the integrity of the insurance marketplace by misleading consumers or imposing unjust financial burdens. It is essential for insurers to maintain transparency and fairness in their practices to protect consumers and ensure a competitive insurance environment.