What term describes the act of misrepresenting a policy to induce a policyowner to change or replace an existing policy?

The term that describes the act of misrepresenting a policy to induce a policyowner to change or replace an existing policy is known as "twisting." This practice typically involves providing misleading or incomplete information about the benefits or terms of a new policy, with the intention of persuading the policyholder to abandon their current coverage in favor of a new one.

Twisting is considered unethical and can be illegal, as it undermines the informed decision-making process that policyholders should have when evaluating their insurance options. By presenting an old policy in a negative light while exaggerating the advantages of a new policy, the agent or broker engages in a deceptive practice intended to boost their own sales at the expense of the policyholder’s best interests.

On the other hand, fraud involves a broader range of intentional misrepresentations meant to deceive for personal gain, while deception refers more generally to misleading behaviors. Misrepresentation is a related term but does not specifically capture the aspect of changing or replacing a policy. Twisting is a specific form of misrepresentation that targets existing policies directly during the sales process.