A TX agent offers a prospective client a $40 restaurant gift card as a 'thank you' for purchasing a life insurance policy. Which statement best describes this act under Texas law?

Why this is the answer

Since September 1, 2025, Texas's anti-rebating rules for life insurance and annuities are in Insurance Code Chapter 1702, added by HB 2221, which moved them out of §541.056. §1702.102 bars an agent from giving, as an inducement to enter into a life policy, any valuable consideration or anything of value not specified in the policy. §1702.053 allows noncash gifts, including meals, only if the cost stays within an amount the commissioner finds reasonable, the offer is not unfairly discriminatory, and the consumer is not required to buy, keep or renew a policy in exchange; §1702.104(5) separately allows promotional items and traditional courtesies worth $25 or less. A $40 restaurant card handed over as a 'thank you' for buying the policy is given in exchange for the purchase, so it is an unlawful inducement. No Texas rule makes every gift under $50 lawful, handing the gift over after issuance does not help when it rewards the purchase, and noncash gifts are not exempt from the rebating rules.