Which term refers to the unethical and illegal practice of making a misleading statement about an insurance policy to induce a person to buy a policy with another insurer?

• A. Twisting
• B. Misrepresentation
• C. Coercion
• D. Defamation

Answer: (A)

Twisting is an unethical practice in which a person selling insurance uses misleading statements about a policy to persuade someone to replace their current coverage with a policy from another insurer. This deception can lead to surrender charges, loss of benefits, or higher costs, and regulators treat it as illegal because it targets a consumer’s interests with false or deceptive comparisons. Misrepresentation involves false statements about the policy’s terms or benefits in general, but twisting specifically centers on inducing a switch to another insurer through deception. Coercion relies on threats or pressure rather than false information, and defamation involves harming someone’s reputation with false claims rather than influencing an insurance transaction.