Two life producers replace existing policies. Producer One misrepresents the terms of the client's current policy to persuade her to surrender it. Producer Two presents an accurate side-by-side comparison, discloses all costs, and lets the client decide. Under New Jersey trade practice standards, which statement is correct?

Why C is correct

Twisting is the unfair trade practice of inducing a policyholder to lapse, forfeit, or replace an existing policy through misrepresentation of its terms or benefits. The vice is deception, not replacement itself: New Jersey regulation, administered by the New Jersey Department of Banking and Insurance, does not forbid a client from changing policies, but it forbids the producer from engineering the change with false statements. Honest comparison and disclosure keep the transaction on the lawful side of the line.

Why the other options are wrong

• A) Replacement with full and honest disclosure is not twisting; the prohibition targets misrepresentation, not replacement as such.
• B) Replacement sales are regulated market conduct; saying the activity is unregulated misstates the framework the department enforces.
• D) The trigger for twisting is the misrepresentation used to induce the change, not whether the new premium happens to be higher.

Memory hook

Twisting = lying to force a swap; comparing honestly is selling, not twisting.