State RegulationsNC specificDifficulty 2/5
To persuade a policyholder to surrender an existing health policy, a North Carolina producer makes an incomplete comparison of the terms of the two policies. Under North Carolina law this conduct is:
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Answer & full 3-part explanation (select an option above, or peek)
Why A is correct
Under G.S. 58-33-75, no licensee may make any written or oral statement that willfully misrepresents the terms of a policy or makes an incomplete comparison to induce a policyholder to lapse, surrender, exchange, or convert a policy. This is twisting, and it exposes the producer to civil penalties under G.S. 58-2-70 and license action under G.S. 58-33-46.
Why the other options are wrong
- B) Rebating involves giving or accepting valuable consideration not specified in the policy under G.S. 58-33-85; no inducement of value is present here.
- C) The statute expressly covers oral as well as written statements, so an oral incomplete comparison is still twisting.
- D) Unfair claims settlement practices under G.S. 58-63-15(11) concern the handling and payment of claims, not sales conduct.
Memory hook
Twisting = willful misrepresentation or half a comparison to force a surrender.