United States
Hong KongWhat TDI actually regulates, and what it does not
TDI licenses agents, sets the passing score, certifies continuing education programs and disciplines licensees. Pearson VUE administers the examination under contract, IdentoGO takes the fingerprints, and the securities regulation of variable products belongs to a federal regime that sits entirely outside the Department reach.
Four organizations touch your license and only one of them is the regulator. Sorting out which is which removes most of the confusion in this process, and it also removes a specific bad habit: emailing the wrong body and waiting a week for an answer they were never going to have.
Who does what
| Body | What it does | What it cannot do |
|---|---|---|
| Texas Department of Insurance | Issues the license, sets the passing score, certifies CE programs, disciplines licensees | Administer the examination itself |
| Pearson VUE | Runs the examination under contract, publishes the content outlines and handbook | Decide whether you get a license |
| IdentoGO by IDEMIA | Takes fingerprints and transmits them to DPS and the FBI | Anything else in this process |
| Sircon | The electronic channel for applications, renewals, appointments and CE records | Make any decision at all |
The first row's right-hand column is the useful one. The Department sets the score you have to reach and does not run the test you reach it on, which is why the pass mark is a scaled score that Pearson reports and TDI determines. Nobody publishes a percentage because a percentage would belong to a paper rather than to a standard.
The commissioner's authority
The Insurance Code gives the commissioner of insurance the rulemaking power that most of this system runs on. Section 4001.005 allows rules necessary to implement the title and to meet the minimum requirements of federal law. Chapter 4002 lets the commissioner prescribe the examination and negotiate an agreement with a testing service to administer it. Chapter 4004 gives the department exclusive jurisdiction over all matters relating to the continuing education of agents licensed under the code.
Exclusive is the operative word in that last one. No other Texas body sets continuing education for insurance agents, which is worth knowing when a course provider claims some other approval.
The enforcement side
This is where TDI is most obviously a regulator rather than an administrator. Section 4001.007 lets the department investigate alleged violations. Section 4005.102 lets it deny, suspend, revoke or refuse to renew a license, on top of the remedies in chapter 82. Section 4005.109 lets the commissioner establish fines by rule for certain violations.
It can also go further than paperwork. Section 4005.110 lets the attorney general, a district or county attorney, or the department acting through the commissioner bring an injunction proceeding against anyone engaging in the business of insurance in violation of the code. And subchapter D of chapter 4005 carries actual criminal offenses: acting as an agent after suspension or revocation, assisting somebody whose license was suspended or revoked, and embezzlement or conversion by an agent who collects premiums.
Section 4005.153 says an agent who collects premiums and then embezzles, fraudulently converts or appropriates that money to their own use commits an offense, punished as if they had stolen the money. That sits alongside losing the license rather than instead of it.
What TDI does not reach
Securities is the big one. Variable life and variable annuities are insurance contracts regulated by TDI and securities regulated federally, and no Texas insurance license authorizes the securities half. The Insurance Code itself acknowledges the split by defining a registered contract as one subject to prospectus delivery under federal securities law. Selling variable products needs a securities license covers what that means for you.
Prepaid funeral contracts are a smaller and stranger example. Chapter 4054 creates a funeral prearrangement life insurance agent license, and the contracts those policies fund are regulated by the Texas Department of Banking under the Finance Code. Two regulators, one transaction.
And employment is not regulated at all. TDI licenses you and does not find you work, does not set what carriers pay, and has no view on whether you should go captive or independent. Those are commercial questions with no regulator behind them, which is exactly why so much bad advice circulates about them.
What the Department publishes
More than most people realize, and one document in particular. Under section 4002.008 the Department produces an annual report on examination pass rates, prepared by Pearson VUE and filed with the Governor. Its fiscal year 2025 edition records 26,427 first-time candidates on this examination at a 57.7% pass rate, with a mean scaled score of 69.75, alongside the same figures for every other insurance examination Texas runs.
Our opinion: that report is the most useful public document in Texas insurance licensing and almost nobody reads it. It is where a candidate can find out that the Life Agent paper passes 46.7% of first-time candidates, or that only 403 people sat the all-lines adjuster examination in a year. Study sites quote pass rates they cannot source while the regulator publishes the real ones for free.
The concession: we hold the Insurance Code, the outlines, the handbook and that report, and we do not hold the Department's own rules in title 28. So this page describes TDI's statutory authority accurately and its day-to-day practice only as far as the handbook reveals it.
Common questions
What does the Texas Department of Insurance do?
It issues insurance licenses, sets the passing score for licensing examinations, certifies continuing education programs, investigates alleged violations, and disciplines licensees. It does not administer the examination itself, which Pearson VUE runs under contract.
Who sets the Texas insurance exam pass mark?
TDI. The candidate handbook says the passing score is determined by the Department, and Pearson reports it as a scaled score rather than a percentage. No percentage pass mark is published, and figures quoted elsewhere online are not sourced to TDI.
Does TDI regulate variable annuities?
Only the insurance half. Variable life and variable annuities are also securities under federal law, and the Insurance Code itself defines a registered contract by its obligation to deliver a prospectus. The securities side sits outside TDI's authority entirely.
Can TDI bring criminal charges?
Subchapter D of chapter 4005 creates offenses including acting as an agent after suspension or revocation and embezzlement of premium by an agent. Section 4005.110 lets the attorney general, a district or county attorney, or the department seek an injunction against unlawful insurance business.
What does TDI publish about the exam?
An annual examination report prepared by Pearson VUE and filed with the Governor under section 4002.008. Its FY2025 edition gives first-time candidate counts and pass rates for every Texas insurance licensing examination, including 26,427 candidates and 57.7% on this one.