What does twisting refer to in the context of insurance?

In the context of insurance, twisting specifically refers to the practice of convincing a policyholder to replace an existing insurance policy with a new one from a different company, often without fully disclosing important details. This can be detrimental to the policyholder, as they may lose valuable benefits or incur unnecessary costs in the process of making the switch.

The essence of twisting lies in its potential to mislead customers about the advantages of changing their insurance policies, often emphasizing perceived benefits while omitting the drawbacks of abandoning an existing plan. This practice is generally considered unethical and is often regulated or prohibited to protect consumers from deceptive practices.

Understanding this concept is crucial for recognizing the responsibilities of insurance agents and the potential risks to consumers in the insurance market.