What does the term "twisting" refer to in life insurance?

The term "twisting" in life insurance specifically refers to the practice of persuading an existing policyholder to change their policy or replace it with a new one based on misleading or false information. This can involve exaggerating the benefits of the new insurance policy or downplaying the security of the current one. The primary concern surrounding twisting is that it can lead to financial harm for the policyholder, as they may lose valuable benefits from their existing policy and incur unnecessary costs from the new policy.

In the context of this question, the correct choice highlights the unethical implications of twisting, which can compromise the integrity of the insurance industry and potentially harm consumers. It is important for agents to adhere to ethical standards and provide accurate information to clients, ensuring that any recommendations made are in the best interest of policyholders rather than driven by personal gain or commission incentives.