Surplus Lines Insurance Agent Exam Study Guide

60 minutes.

$29.

60 scoreable questions.

About 1 minute per question — 60 minutes divided across 60 scoreable questions.

Keep roughly a one-minute-per-question rhythm and flag hard items to revisit rather than stalling, since total time is tight.

$58 total — the $29 fee applies to each attempt.

Yes — the 60 questions are specifically the scoreable questions. Any additional pretest/unscored items would be separate.

On the TDI website's surplus lines apply page (tdi.texas.gov/agent/surplus-lines-apply.html).

You use double your average allotment — roughly two questions' worth of time — so difficult items should be flagged and skipped when possible.

False. It gives you 60 minutes (one hour) for 60 scoreable questions.

60 scoreable questions within a 60-minute window.

Slightly under one minute each, banking a few minutes to revisit flagged questions before the 60-minute limit ends.

The number of questions (60 scoreable), the time limit (60 minutes), and the fee ($29).

Insurance placed with non-admitted (unlicensed) carriers that fall outside the standard market — used when admitted insurers decline or cannot offer coverage.

An admitted insurer is licensed and regulated by the state; a non-admitted insurer is not licensed but may be authorized to operate for hard-to-place risks.

The insured must stand to suffer a direct financial loss if the insured property is damaged or the insured person dies — without it, a policy is unenforceable.

Both insurer and insured must disclose all material facts relevant to the risk; concealment or misrepresentation can void the policy.

The insurer's right to recover from a third party who caused the loss after the insurer pays the claim — protects the insurer from paying twice.

Insurance policies are contracts of adhesion — the insured has no opportunity to negotiate terms; ambiguities are construed against the insurer.

A deductible is the amount the insured must pay before coverage begins; it discourages frivolous claims because the insured bears initial loss.

The insured and insurer share losses proportionally (e.g., 80/20) above a threshold; it incentivizes the insured to minimize risk and prevents overinsurance.

Insurance is meant to restore the insured to their position before the loss, not create a profit — the insured cannot recover more than actual loss.

An amendment that modifies coverage by adding, deleting, or clarifying terms — it becomes part of the contract.

The insurer waives its right to recover from a third party; commonly required by landlords to prevent insurers from suing them.

When an insurer's words or conduct lead the insured to reasonably rely on them, the insurer cannot later deny coverage — an affirmative defense.

Policyholders' reasonable expectations of coverage are honored even if the fine print excludes it — protects insureds from unfair surprise denials.

An occurrence policy covers losses that happen during the term regardless of when the claim is filed; a claims-made policy covers only claims filed during the term.

The insurer pays the full cost to repair or replace damaged property at current prices, without deduction for depreciation.

The replacement cost minus depreciation — what the property was worth immediately before the loss.

The maximum amount the insurer will pay for a covered loss; the insured bears any loss above this amount.

When multiple policies cover the same loss, each pays its proportional share based on its limit — prevents double recovery.

A temporary agreement that provides immediate coverage while the formal policy is being issued — legally binding and continues until replaced.

The ratio of losses paid to premiums collected — a high loss ratio signals unprofitable risk and may lead insurers to raise rates or decline renewal.

When higher-risk individuals buy more insurance than lower-risk ones, skewing the risk pool unfavorably — insurers use medical exams, underwriting questions, and underwriting guidelines to mitigate it.