Insurance Twisting, Churning, and Sliding: How to Not Let Cunning Agents Twist You Around

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With over a trillion dollars paid in insurance premiums annually, the ever-growing U.S. insurance industry has long set a “being insured is being protected” standard. Over 91% of Americans can boast of health insurance coverage among many other types of insurance, including life, home, car, travel, pet … and even a nose job. Chances are if you can imagine something being insured, it most likely can be insured.

Depending on the age, occupation, and whims of fancy, you may have different insurance demands, but the main point is that you would want to be insured. And if so, then it would only be logical to do your homework before taking action, starting with arguably the most egregious phenomenon in the whole affair in insurance twisting.

What Is Twisting in Insurance?

Whether you’re about to get your first insurance policy or change the insurance policies you already own, chances are you’ll ask an insurance agent for help – which, depending on the persona of the latter, may turn out to be the very best experience of your life … or a complete disaster.

How come? Unfortunately, insurance agents have pretty much room for maneuver in the insured-insurer relationship, and some of them are not afraid to scam their clients for personal enrichment. But let’s move forward to the subject at hand.

Insurance twisting is when an insurance agent intentionally convinces you to switch to an allegedly better insurance policy, although it would only benefit one party – the agent. Simply put, you are deliberately tricked into buying insurance policies that you don’t need.

Agents live off commissions, and sometimes the temptation is too high.

Infographic “Health Insurance Fraud: Facts & Figures To Stay Protected On All Fronts”

What Can And Cannot Be Considered Insurance Twisting

Now that you know what twisting is, let’s draw two examples so that you can understand what would not be considered twisting:

You should never blindly trust insurance agents. Having second thoughts is actually good, and especially so because there may be more tricks up the sleeves of insidious agents than mere insurance twisting.

What Is Churning in Insurance?

When you want to change your existing coverage, you would likely consult with your current agent in the first place, wouldn’t you? Alas, unscrupulous agents may resort to churning,

Insurance churning is when an agent intentionally convinces you to switch to an allegedly better insurance policy within the same company, although the replacement would only benefit the agent.

Churning is very similar to insurance twisting with the only exception that in the former case, you’re tricked by the same company.

What Is Sliding in Insurance?

The trickiest of all, though, is insurance sliding, as it involves addendums and riders, usually the most overlooked part of insurance.

Insurance sliding is when an agent intentionally omits to disclose the full details on the coverage – including addendums and riders – which results in the higher insurance premium, or when an agent intentionally sells a rider that provides no extra coverage.

An example of sliding would be if you weren’t informed about the increase in premiums, or the addendums and riders were not authorized by you.

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Protect Yourself Against Insurance Agents’ Tricks

Most states do provide anti-twisting legislation or example,  life insurance replacement requirements endorsed by the National Association of Insurance Commissioners (NAIC) are widely adopted, but the definitions and terms concerning insurance twisting are so vague that most of the time it’s unreasonably difficult or even impossible to bring crafty agents to justice. Therefore, you have to protect yourself on your own, which you can do if armed with your common sense and the following checklist:

  1. Make sure you’re comfortable with the agent. If you feel overwhelmed by the amount of information and/or the language of the agent, there’s a chance they want to twist you around. A direct and pushy hard sell is considered a poor technique in the insurance industry.
  2. Slowly peruse all the details of the proposed insurance. It may take a lot of time to understand the nuances of the policy, but a good agent is also a good educator. Any signs of irritation or unclear answers to your questions – no matter how many you’ve asked – would be a huge red flag.
  3. Look for the right balance between coverage level, premium, and deductible. Weigh all the pros and cons of the coverage and make sure to study the disclosure statement. The right balance is what this is all about. A switch to a policy with higher coverage and the same premium and deductible would be a win for you. However, an unreasonably good offer may just as well be twisting.

The Gut Instinct

As preposterous as it may sound, in addition to being educated, it may be a good idea to listen to your gut instinct. Most insurance codes of conduct are based on natural law, which propagates intrinsic human values and makes the most customer-friendly conduct the only natural and logical one. In other words, it might be better to double-check, postpone, or even avoid the deal if your gut instinct indicates so.

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Date added: September 29, 2021