What does 'twisting' refer to in insurance practices?

'Twisting' refers specifically to the practice of inducing a policyholder to replace an existing insurance policy with a new one based on improper motives, such as misleading information about the benefits of the new policy or downplaying the advantages of maintaining the existing policy. This is considered a deceptive practice because it can result in the policyholder losing valuable benefits or incurring unnecessary costs.

The focus on improper reasons is critical, as twisting often involves misleading the consumer about the nature of their current policy or the new policy being offered. This tactic undermines the integrity of the insurance market and can cause significant financial harm to consumers who may not fully understand the implications of switching policies. Understanding this concept is essential for ensuring ethical sales practices in insurance.