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State RegulationsGA specificDifficulty 2/5

A producer in Columbus, Georgia persuades a policyholder to surrender an existing life policy by exaggerating the benefits of a new policy. Under Georgia law, this practice is:

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Answer & full 3-part explanation (select an option above, or peek)

Why C 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. Lawful replacement is possible when the producer makes honest comparisons and follows the Reg. 120-2-24 disclosure process, but exaggerating the new policy's benefits to force a surrender converts the transaction into a prohibited unfair trade practice.

Why the other options are wrong

  • A) Replacement conducted properly is lawful, but the described misrepresentation defeats that defense and makes the conduct twisting.
  • B) Rebating concerns giving or accepting premiums or valuable consideration, not inducing surrenders.
  • D) Boycott, coercion, and intimidation under O.C.G.A. § 33-6-4(b)(4) involve group pressure or compulsion, not persuading one policyholder to replace coverage.

Memory hook

Twist = misrepresent to make them surrender and switch.

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State RegulationsGA specificDifficulty 3/5

A Georgia producer, wanting a new commission, tells a policyholder that the policyholder's current policy is worthless and persuades the policyholder to surrender it and buy a similar policy from another insurer, based on those false statements. This practice is:

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Answer & full 3-part explanation (select an option above, or peek)

Why C is correct

Under O.C.G.A. § 33-6-4(b)(2), the statutory hook for twisting is making any misrepresentation to induce a policyholder to lapse, forfeit, or surrender a policy. Falsely telling the policyholder the current policy is worthless in order to trigger a surrender and repurchase fits squarely within that definition, and the fact that the replacement comes from a different insurer is typical of twisting.

Why the other options are wrong

  • A) Rebating involves giving or offering valuable consideration as an inducement to purchase, not misrepresenting an existing policy's value.
  • B) Churning describes using cash values to buy additional coverage from the same insurer; here the false statements induce a surrender for a new policy from another insurer.
  • D) Coercion involves force or intimidation in insurance transactions, not deception that induces a surrender.

Memory hook

False words that push a surrender = twisting.

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