What does twisting refer to in insurance?

Twisting refers to the unethical practice in the insurance industry where an agent misrepresents or omits important information about an existing policy in order to persuade a policyholder to cancel their current policy and purchase a new one. This action typically results in the policyholder facing negative consequences, such as losing valuable benefits or incurring unnecessary costs.

Understanding twisting is important as it highlights the ethical responsibilities of insurance agents. Agents must provide accurate and comprehensive information to clients, ensuring they are fully aware of the implications of switching policies. This practice is specifically prohibited in many jurisdictions, including Nevada, to protect consumers from deceptive practices that could jeopardize their financial security.

By recognizing the definition of twisting, it becomes clear that it serves as a caution against misleading clients, ultimately motivating agents to maintain transparency and integrity in their dealings.