While shopping for insurance, we want a balance between a precise coverage level, a deductible that we can afford, and reasonable premiums. We neither want to pay too much for the premiums nor get stuck with an option that can cost more in the future. That is why we turn to an agent for selecting an insurance policy.
Unfortunately, sometimes some agents engage in the unethical practice of insurance twisting. Thus, it is significant to know about this practice to protect yourself from getting into it. Let’s move further with the blog as we are here to provide information about twisting in insurance in detail.
What is insurance twisting?
Insurance twisting is considered a fraud, and in several states, a crime. In this, an insurer twists your policy by convincing you to replace your existing insurance with insurance from another company.
There seems no harm when an agent suggests you change the current policy if it is not providing you with what you need. It is considered violating if they do not recommend a change in this scenario. However, the shift in the policy becomes unethical when they claim that the insurance policy you are twisting with will deliver financial benefits and advantages that do not exist. Though it can happen with any type of insurance, but most commonly with life and health insurance.
How to know that you’re getting twisted?
Usually, we review our existing policy only during a crucial life event like buying a new house and car, having a baby, or taking a new job. However, when an agent is asking you to shift your policy if there is no primary event, consider it as a red flag.
Also, premiums provide protection, and when you have high premiums, you tend to have more coverage levels. When you get better coverage or the same coverage for lower premiums by replacing the policy, it is good. But, if the premiums are surprisingly low and the agent makes tons of promises, then it can be the case of insurance twisting.
While comparing the existing policy with the policy they are selling, and you feel that something is missing in the policy, consider it unethical insurance twisting. Furthermore, an accurate agent shares the commission with his clients, while if there is something wrong, they will hesitate to do so. Therefore, these are the things if anyone knows from the very first time, they can save themselves from such illegal acts.
Protect yourself from insurance twisting
You can protect yourself from insurance twisting by concentrating on some of the significant factors. When you feel uncomfortable with the strange behavior of your agent, like forcing you to change your policy. In such cases, ask for further details. If you acquire all the details, consider it as good since they know what they are selling. They will provide you with all the advantages and disadvantages of the policy selection procedure. Also, tell them that you need time to think about the policy change and review the disclosure statements appropriately. If the agent is not willing to deliver you the information in writing and is not ready to give you enough time, it is a warning for you.
So, acquire knowledge with this information and prevent yourself from insurance twisting.
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