State RegulationsGA specificDifficulty 2/5
A Georgia agent tells a policyholder that her current policy's dividends are 'about to be cut' to persuade her to let the policy lapse and buy a new one from him. This conduct is:
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Answer & full 3-part explanation (select an option above, or peek)
Why B is correct
Under O.C.G.A. § 33-6-4(b)(2), making any misrepresentation to induce a policyholder to lapse, forfeit, or surrender an existing policy is the Georgia statutory hook for twisting. The fabricated dividend scare is exactly that inducement. Suitability paperwork does not launder a false statement, and the prohibition applies regardless of whether the replacement ultimately serves the client.
Why the other options are wrong
- A) Suitability does not excuse a knowing misrepresentation; inducing lapse or surrender through false statements is prohibited twisting.
- C) Rebating involves giving or receiving premium rebates or valuable consideration; no rebate is described here.
- D) Defamation targets the financial condition of another insurer in written or oral form; disparaging the client's own dividends is twisting.
Memory hook
Twist = lie to make a policy die — lapse, forfeit, or surrender is the tell.