What the License Authorizes

A Texas Life and Health Insurance license authorizes you to sell, solicit, and negotiate life insurance, health insurance, annuities, and related products in Texas. It is one of the two primary insurance producer licenses in Texas — the other being Property and Casualty. Many producers hold both licenses. The Life and Health license covers term life, whole life, universal life, variable life, individual and group health insurance, disability income policies, long-term care insurance, Medicare supplement policies, and annuities.

Pre-Licensing Education Requirement

Before you can sit for the Texas Life and Health exam, you must complete 40 hours of pre-licensing education from a Texas Department of Insurance (TDI)-approved provider. This is a hard requirement — Pearson VUE will not allow you to schedule the exam without proof of completion. The pre-licensing course covers all exam content areas and most approved providers include practice exams. Complete the pre-licensing course before scheduling your exam date.

Exam Format

Exam Content Breakdown

What the Exam Covers

Texas Laws and Regulations (25% — 33 questions)

This is the largest content area and the one most commonly underestimated by candidates who use national study materials. The Texas-specific content covers TDI licensing requirements, the Texas Insurance Code provisions that govern producer conduct, replacement regulations (particularly important for life insurance), suitability requirements for annuity sales, the Texas Life and Health Insurance Guaranty Association, free-look periods by product type, and prohibited practices. The replacement regulations and suitability requirements for annuities are the most heavily tested Texas-specific topics. Study the TDI agent licensing handbook and the Pearson VUE content outline directly — these are the source documents for this section.

Life Insurance (20% — 26 questions)

Policy types and their distinguishing characteristics are the core of this section. Term life — level, decreasing, and return-of-premium — and the circumstances where each is appropriate. Whole life — the cash value accumulation mechanism, policy loans, nonforfeiture options (cash surrender, reduced paid-up, extended term), and dividend options. Universal life — the flexible premium structure, the cost of insurance deduction, and how the policy can lapse. Variable and variable universal life — the separate account, the investment risk borne by the policyowner, and the securities licensing requirement these products trigger. Policy provisions that appear on every exam: free-look periods, grace periods, reinstatement provisions, incontestability clauses, and beneficiary designation rules including the rights of irrevocable beneficiaries.

Health Insurance (20% — 26 questions)

Individual and group health insurance structures, the difference between indemnity and managed care plans (HMO, PPO, EPO, POS), and the coordination of benefits rules when a person has multiple health policies. Disability income insurance — short-term versus long-term, own-occupation versus any-occupation definitions, elimination periods, and benefit periods. Long-term care insurance — benefit triggers (activities of daily living), elimination periods, inflation protection options, and the Texas partnership program. Medicare supplement (Medigap) policies — the standardized plan letters, what each covers, and the guaranteed issue situations. ACA-related provisions that appear in Texas insurance law context.

Annuities (10% — 13 questions)

Fixed, variable, and indexed annuity structures and the risk each places on the insurance company versus the annuity owner. Accumulation phase versus distribution phase. Immediate versus deferred annuities. Payout options (life only, life with period certain, joint and survivor) and the tax treatment of each. Surrender charges and the free withdrawal provisions most annuity contracts include. Texas suitability requirements for annuity recommendations are tested here and in the Texas laws section — know what documentation is required before recommending an annuity and what factors must be considered.

Underwriting (10% — 13 questions)

Field underwriting responsibilities — what a producer must do before submitting an application, the importance of complete and accurate applications, and the producer's liability when material information is omitted. Insurable interest requirements for life and health policies. Risk classification — preferred, standard, and substandard classifications and how they affect premiums. Medical Information Bureau (MIB) and its role in the underwriting process. Conditional receipts and binding receipts and what coverage, if any, is in force between application and policy delivery.

Ethics and Suitability (10% — 13 questions)

Producer duties to clients — disclosure requirements, the duty to recommend suitable products, and the prohibition on churning and twisting. Advertising rules — what can and cannot be included in insurance advertisements under Texas law. Anti-rebating rules — the prohibition on giving anything of value as an inducement to purchase insurance, and the narrow exceptions. Privacy requirements — the Gramm-Leach-Bliley Act provisions that govern how producers handle nonpublic personal information. Errors and omissions exposure and the situations that most commonly generate producer liability.

Taxation (5% — 6 questions)

The income tax treatment of life insurance premiums, death benefits, and cash value access (loans versus surrenders). Section 1035 exchanges — when they are permitted and what tax advantage they provide. The taxation of annuity distributions — LIFO treatment for non-qualified annuities, the exclusion ratio for income payments. Health insurance premium deductibility for self-employed individuals and the employer deduction for group health premiums. These are the tax topics that appear on the exam — this section does not require deep tax knowledge, but it does require knowing the basic rules that apply to insurance products.

Hardest Topics on the Exam

Three areas generate the most missed questions. First, Texas replacement regulations — the specific notice requirements, the producer obligations when replacing existing life insurance, and the documentation that must be provided to the applicant. These rules are Texas-specific and detailed. Second, annuity suitability requirements — Texas adopted enhanced suitability standards for annuity sales that are more specific than general suitability rules, and the exam tests the specific factors a producer must consider and document. Third, the coordination of benefits rules for health insurance — particularly the order of benefits determination when a person has both group coverage through an employer and individual coverage, or when a child is covered under both parents' group plans.

How to Study

Complete Your Pre-Licensing Course Actively

The 40-hour pre-licensing requirement is not a formality — the course content maps directly to the exam content outline. Take notes, complete all the practice questions your provider includes, and pay particular attention to the Texas-specific sections. Most candidates who fail the exam did not adequately study the Texas laws section during their pre-licensing course.

Download the Official Content Outline

Pearson VUE publishes the official content outline for the Texas Life and Health exam. It lists every topic area and its percentage weight. Download it and use it as your study checklist — if a topic is on the outline, it can appear on your exam. If a topic is not on the outline, do not spend time on it.

Focus on Texas Law First

With 25% of the exam dedicated to Texas-specific content, candidates who study only national insurance concepts are leaving points on the table. Spend dedicated study sessions on Texas replacement regulations, Texas annuity suitability requirements, TDI licensing rules, and the Texas Life and Health Insurance Guaranty Association. These topics will not be covered adequately in generic national flashcard decks.

Practice Under Timed Conditions

At 130 questions in 170 minutes you have 1.3 minutes per question. That feels like enough time until you hit a calculation question or a complex scenario. Full-length timed practice exams in the week before your exam reveal which topics slow you down. Candidates who consistently score above 75% on timed practice exams pass the actual exam at a very high rate.

After You Pass

Paid Pre-Licensing Courses and Exam Prep

Texas requires 40 hours of pre-licensing education before you can sit for the exam. These providers are TDI-approved and also include exam prep materials beyond the pre-licensing requirement. Prices reflect self-paced online options — live and in-person formats cost more.

ExamFX

One of the most widely used insurance pre-licensing providers in Texas. ExamFX includes a study plan builder, on-demand video lessons, and a readiness exam that predicts how likely you are to pass before you schedule your actual test date. The readiness indicator is genuinely useful — it tells you when you are ready rather than guessing. Access period is 60 days from purchase. Pricing for Texas Life and Health starts around $99 for the pre-licensing course with exam prep included. Widely recommended in insurance forums for its structured approach.

Kaplan Financial Education

Kaplan is the most comprehensive option and the best choice if you prefer instructor-led learning. They offer on-demand self-study, live online classes, and in-person classes in Texas. The in-person Texas Life and Health course runs four full days — the most thorough classroom option available. Kaplan follows a Prepare, Practice, Perform methodology and includes dedicated email support. Pricing for self-paced online starts around $129 for pre-licensing; live online and in-person options run higher. Best for candidates who want structured instruction rather than pure self-study.

A.D. Banker and Company

A.D. Banker is known for its well-written study manuals — each chapter includes retention questions and lightning fact summaries that make reviewing efficient. Live online classes run Mondays and Tuesdays, which limits scheduling flexibility compared to Kaplan and ExamFX. Self-paced access is 60 days. Pricing is competitive with ExamFX. A good choice if you prefer reading-based study over video lectures.

Xcel Testing Solutions

Xcel is a lower-cost option — Texas Life and Health pre-licensing runs around $25-40 — that gets consistent positive mentions from Texas candidates on insurance forums. It covers the required 40 hours and includes practice questions. Less feature-rich than Kaplan or ExamFX but adequate for candidates who prefer to study efficiently without extras. If budget is a constraint, Xcel is the most recommended affordable option specifically for Texas.

CompuCram

CompuCram focuses heavily on vocabulary and terminology as a foundation for exam readiness. Over 85% of their students report passing on the first attempt. Their readiness assessment is similar to ExamFX — it tells you when you are statistically ready to sit for the exam. Pricing is generally under $100 for state-specific courses. A good fit for candidates who find that terminology confusion is their main obstacle.

Study Books for Independent Preparation

If you prefer a book-based approach to supplement your pre-licensing course, several Texas-specific exam prep books are available on Amazon. Look for titles that explicitly include a Texas state law supplement — generic national life and health books do not cover the 25% of the exam dedicated to Texas-specific content. The most useful books include 10 or more full-length practice tests with detailed explanations, which is more valuable than content review alone by the time you are close to your exam date.

Titles to search for: Texas Life and Health Insurance License Exam Prep 2026 — look for editions that include a state law review section and at least 1,000 practice questions with explanations. Mometrix also publishes a Life and Health Exam Secrets study guide that covers national content well, but pair it with a Texas-specific supplement for the state law section.