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.