What is insurance twisting?
Asked by: Ms. Else Yost IV | Last update: September 2, 2025Score: 4.4/5 (31 votes)
What is an example of twisting in insurance?
An example of twisting in homeowners insurance would be if you built a new garage and called your agent to ask if it's covered. If they say it's not, and tell you that you must add a rider to your existing policy, when it is covered, that would be twisting.
What's the difference between churning and twisting in insurance?
Twisting is the act of replacing insurance coverage of one insurer with that of another based on misrepresentations (coverage with Carrier A is replaced with coverage from Carrier B). Churning is in effect "twisting" of policies by the existing insurer (coverage with Carrier A is replaced with coverage from Carrier A).
Which of the following describes twisting insurance?
Twisting in insurance is when an agent convinces a policyholder to replace their current policy with a new one that is often to their detriment. The correct answer is B: Policy replacement that is to the detriment of the policyowner.
What is the twisting term?
From Glossary of Meteorology. (Also called tilting term, tipping term.) The term in the vorticity equation that represents the generation of vertical vorticity by the twisting of horizontal vorticity into the vertical through the agency of shear in the vertical velocity.
How To Memorize General Insurance Terms For The Insurance Exam
What is an example of twisting?
When you twist something, you turn it in a different direction. You might twist off a bottle cap, or you might even twist the plot of a story you are writing. A kite's tail twists in the wind, curling around itself, and a baker twists a piece of dough into a pretzel shape.
What is the legal definition of twisting?
Legal Definition
twisting. noun. twist·ing. : the making of a misrepresentation by an insurance agent to cause a policyholder to surrender or lapse an insurance policy especially for the purpose of replacing it with another policy.
What does rebating mean in insurance?
Rebating refers to returning a portion of the premium or the agent's/broker's commission on the premium to the insured or other inducements to place business with a specific insurer.
Which of the following best describes the illegal act of twisting?
Explanation: The illegal act of twisting is best described by option B) Replacing an insurance policy from one insurer to another based on misrepresentation.
What is switching in insurance?
Definition: Switching is the option provided to the insured by the insurer wherein the insured is entitled to move to a different policy or transfer from one fund to another within the same policy.
What does sliding mean in insurance?
It has come to the Director's attention that some insurance producers are engaging in insurance "sliding." "Sliding" is defined as an agent's failure to fully disclose all the details of, and obtain informed consent to, the purchase ofall products and services being included in an insurance transaction.
What is twisting when it comes to insurance?
Twisting in insurance is when a producer replaces a client's contract with similar or worse benefits from a different carrier. Insurance producers that sell the types of products most at risk for twisting and churning tend to be those who're licensed in life and annuities.
What is insurance coercion?
Coercion can be defined as "an unfair trade practice that occurs when someone in the insurance business applies physical or mental force or threat of force to persuade another to transact insurance." Coercion doesn't have to always be aggressive, though.
What is a real life example of twisting?
Wringing of clothes by hand: When you wring something dry using your hands, you twist the cloth out - essentially creating torsion which drives the water out and in turns dries the cloth!
What is the penalty for insurance twisting?
Administrative fines for twisting, churning, or fraudulent signatures may not exceed an aggregate amount of $50,000 for all nonwillful violations arising out of the same action or an aggregate amount of $250,000 for all willful violations arising out of the same action.
How do you describe twisting?
the act of squirming or turning about; wiggling: Her restless twisting disturbed the bedsheets.
What is commingling in insurance?
Commingling refers broadly to the mixing of funds belonging to one party with funds belonging to another party. It most often describes a fiduciary's improper mixing of their personal funds with funds belonging to a client.
Which of the following will not be considered unfair discrimination by insurers?
Explanation: Discriminating in benefits based on the insured's habits and lifestyle will NOT be considered unfair discrimination by an insurer.
Which of the following is a twisting force?
Torque: A twisting force that tends to cause rotation.
What does churning mean in insurance?
Churning also refers to the practice of an insurance agent replacing a policyholder's existing insurance policy with another, often without consulting the policyholder, and frequently without any change to the coverage itself. Agents engage in this practice to secure an additional commission from the new policy.
What is concealment in insurance?
Definition: Concealment is the act of hiding or not putting forward any relevant fact in front of the insurer that need to be revealed. An applicant commits this fraudulent act intentionally or unintentionally that may lead to loss to the insurer.
What is an illegal inducement in insurance?
Other types of unlawful inducements (also called illegal inducements) may include a producer offering a prize to any client that purchases a policy, entering clients into a drawing or raffle if they purchase a policy, or even wining and dining a client and their family at an expensive restaurant with the expectation ...
What is the process for twisting?
twisting, in yarn and rope production, process that binds fibres or yarns together in a continuous strand, accomplished in spinning or playing operations. The direction of the twist may be to the right, described as Z twist, or to the left, described as S twist.
What does coercion mean?
Coercion is the act or process of persuading someone forcefully to do something that they do not want to do. It was vital that the elections should be free of coercion or intimidation. Synonyms: force, pressure, threats, bullying More Synonyms of coercion.
Is twisting declared unethical?
Twisting is illegal because it essentially is defrauding a consumer. It also does not allow consumers enough time and resources necessary for making informed decisions regarding their insurance policies.