Which term refers to misleading clients about the benefits of switching policies?

The term that refers to misleading clients about the benefits of switching policies is "twisting." This practice involves persuading a policyholder to replace an existing insurance policy with a new one under false pretenses, typically claiming that the new policy offers greater benefits or is more advantageous than the current policy when that may not be the case. Twisting is unethical as it can cause clients to incur unnecessary costs or lose valuable coverage.

Churning, while related, specifically involves an agent coaxing a client into repurchasing insurance policies primarily for the purpose of earning commissions rather than for the client's benefit. Rebating refers to giving back a portion of the premium to induce a client to purchase a policy, which is also against regulations. Although fraud encompasses a broader range of unethical actions, twisting specifically pinpoints the act of misleading a client regarding the advisability of switching policies. This distinction is important for ensuring ethical practices in the insurance industry.